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Go Ahead, Move Your Money

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Even if Bank Transfer Day was a resounding success, it would be little skin off the noses of the megabanks.

Consumer vitriol is largely beside the point when it comes to bank funding these days. A flight to cash among businesses rattled by the euro-zone crisis and economic uncertainty has been the dominant theme, and money-center institutions have been flooded with sometimes troublesome bounties.

Besides, it is easy to doubt that the most recent grassroots flare-up portends mass defections from the giant banks. The Occupy Wall Street protests overlap with years of fever waves of populist anger, from the outrage over bonuses to traders at American International Group Inc. to the Tea Party movement.

Through it all, there has been no sign that disgusted customers are draining the behemoths of their deposits.

The Federal Reserve publishes weekly data on deposit levels at large banks (the 25 with the most assets) and small banks (the rest). As of the week that ended Oct. 26 — the most recent available — large banks had $4.7 trillion of deposits, up about 0.6% since the week that ended Sept. 28, the Wednesday before hundreds of protestors were arrested on the Brooklyn Bridge, greatly magnifying Occupy Wall Street’s media profile. (Over the same time, deposits at small banks grew about 0.2%, to $2.8 trillion.)

In fact, increases in deposits at the large banks have far outstripped growth at the small banks through the financial crisis and its aftermath.

Even excluding deposits held in time accounts with balances of more than $100,000 — such funds have traditionally been more rate-sensitive and less reflective of durable customer relationships — big banks beat small banks by a handy margin (see the first chart). Such funding grew 68% since the beginning of 2007, to $4.4 trillion at Oct. 26 among the big banks, and 37%, to $2.4 trillion, at the small banks.

The second chart shows the important role played by nonfinancial businesses. These firms have long accounted for the bulk of checking deposits, and while household checking deposits have dipped since 2009, businesses have been greatly increasing their checking deposits in recent quarters.

To be sure, total dollar amounts of deposits might not say much about an upheaval among ordinary consumers. Accounts could be vanishing while dollars are not.

The Credit Union National Association has claimed that its members signed up 40,000 new customers on Bank Transfer Day on Nov. 5. That kind of volume might reflect a groundswell, or it might be an ordinary weekend.

In any event, it is a rounding error compared with the rosters at the Big Four, which reported more than 300 million accounts with balances under $250,000 as of the third quarter (see the third chart).

Indeed, while the number of accounts at Bank of America Corp. and JPMorgan Chase & Co. has been roughly stable, the number of accounts at Citigroup Inc. and Wells Fargo & Co. grew more than 40% from the first quarter of last year to the third quarter this year.

Apparently, the big banks can still sell.

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