The biggest banks in the US continue to see a decline in total assets, including deposits held at these banks.
According to a report distributed by S&P Global Market Intelligence, a majority of the largest banks in the US reported a decline in total assets in the second quarter as the banking industry saw assets decline for the fourth time in the last five quarters.
The top 50 banks experienced a whopping $254.5 billion decline in aggregate assets quarter over quarter. More than half of these banks (28) saw sequential declines.
When looking at Q1 2023, S&P reports that the 50 largest US banks and thrifts experienced asset growth of $775.30 billion from the fourth quarter of 2022.
JPMorgan Chase & Co., the largest US bank, reported a 2.7% sequential decrease, while assets at Bank of America Corp., Citigroup Inc. and Wells Fargo & Co. fell by 2.2%, 1.3% and 0.5%, respectively.
Smaller banks seem to have performed better, with 18 out of 35 banks with assets between $50 billion and $500 billion experiencing asset growth.
While S&P did not delve into savings rates offered to customers, one has to wonder if this is part of the cause of declining assets. Many big banks or systemically important banks (SIBs) have not been inclined to pass on higher interest rates to account holders, creating an opportunity for Fintechs or other banks to gain assets. Perhaps S&P will follow with a report on interest rates.