May 30, 2011


  • Lydia, your closing statement to this writing states, "a bright side to taking on additional deposits is that these new deposits are also a sign of new customers and new loan opportunities."

    I am not sure I understand your rationale that taking on additional deposits is a sign of new loans. I would appreciate if you could provide more on this line of thinking as additional savings does in fact provide a larger pool of loanable funds. And this can lead to lower nominal interest rates. But this is not necessarily going to lead to new lending.

    Steve Hennigan