Banks’ Internal Capital Markets and Deposit Rates

We thank Allen Berger, Isil Erel, Alberto Pozzolo, and Christian Rauch for helpful comments. We benefited from comments of seminar participants at the ASSA (IBEFA session on Banks, Government Intervention and Deregulation), Carnegie Mellon University, Case Western Reserve University, University of Cincinnati, Federal Deposit Insurance Corporation (FDIC), Federal Reserve Bank of Cleveland, FMA meetings (Atlanta), the Office of the Comptroller of the Currency, The Ohio State University, NBER Corporate Finance meeting, and a webinar organized by the Global Association of Risk Professionals (GARP). The views presented in the paper do not necessarily reflect those of the Office of the Comptroller of the Currency or the U.S. Department of the Treasury. Ben-David and Spatt acknowledge the financial support of the GARP Foundation. Ben-David’s research is supported by the Dice Center at the Fisher College of Business and by the Neil Klatskin Chair in Finance and Real Estate. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.

• September 3, 2015