Bankers need to remember that deposits are still key

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NEVER FORGET THE VALUE OF DEPOSITS: It is clear from banks’ second-quarter earnings reports that the industry was in a zero-interest-rate and excess-deposit position for so long that some bankers dismissed the value of deposits over the modern history of banking or did not price loan-only relationships based on matched funding. The bankers at Pinnacle Financial and ServisFirst never forgot the value of both, because their CEOs wouldn’t let them. These estimates, if adjusted for today’s rate environment, would show a wider gap between a credit-only relationship and one that includes the borrower’s loan and deposits.

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