[partiallypro]

But mass inflows of deposits are exactly how SVB got into the situation it's in now. You have to pay interest on the deposits. I'd much rather go to a truly "too big to fail" bank that can easily cover the deposit interest with a diverse line of business.

[jjeaff]

I don't think Mercury pays any interest on their regular checking or savings accounts.

They offer treasury accounts that you can move money to and buy securities if you want yield.

So I don't think they have too much risk as far as interest on deposits. But what worries me, as a small business owner that has been using and loving Mercury for a few years now is that they offer free domestic and international wire transfers and I worry that they might start charging for that. It is the first bank I have had that did free international wires and I actually use that frequently. My last bank charged $85 and I literally had to fax a signed form to them to get it done.

The thing I don't know is if there is a per transaction fee that the banks pay. I assumed that there is and that Mercury was just eating the cost as a marketing expense.

[TrainedMonkey]

Interest rates are already high, so whoever get the inflows can buy 3 months treasure notes to get the cake and eat it too.

There is still risk of interest rates rising significantly higher, but with 3 months treasure notes the downside is limited.

edit: typoed

[baq]

The thing with interest rates is in high inflation you never know what high really is since high inflation itself is highly volatile.

I.e. don’t be SVB. Hire a risk officer.

[slv77]

There is no need as they can just park the excess reserves with the Fed and earn a risk free rate with no duration risk.

[toast0]

> You have to pay interest on the deposits.

Eh, how much does BofA or Chase pay on deposits? Interest rates have gone up, so they might hit 0.05% now?

[jjeaff]

Do they pay anything at all for business accounts? It wasn't even legal to provide interest checking and savings to business accounts for a few years after dodd-frank. I haven't seen a lot of bank jump to offer it.

[JumpCrisscross]

> mass inflows of deposits are exactly how SVB got into the situation it's in now

It gave them the opportunity to make the mistakes they made. It didn't cause them. If you have more deposits than you can responsibly invest, you cut your rates until you can.

[baq]

Banks are supposed to know how to deal with this problem… a couple didn’t.