What is the avg bank ROI on a customer deposit?
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Replying to @bpmilne
That's a hard & nuanced question. The most straightforward answer is to quote net interest revenue, but if you're looking at deposit profitability, you'd also want to know servicing costs & whether there was ancillary e.g. payments revenue. Most FIs would look at cross-sell too.
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A fun business to look at if you haven't seen it before is StoneCastle. If one can explain what a community bank, brokerage, and StoneCastle all bring to the table and why they all benefit from the relationship, one has anomalously good understanding of financial services.
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Replying to @patio11
Do you have an understanding of what all those organizations share and benefit from?
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Replying to @patio11
Mind sharing your perspective? This is a genuine question.
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Replying to @bpmilne
It's slightly longer than fits in a tweet but: Community bank wants to have more deposits both for the core business of banking and because it allows managing regulatory ratios. Brokerage wants net interest revenue on customer cash, but doesn't have or want a loan book.
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StoneCastle specializes in being technical, regulatory, and sales glue which matchmakes ~constantly between several hundred participants on both sides of that market. It's reallllllly impressive from a systems and market efficiency perspective.
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