SAN FRANCISCO -- Interest rates have climbed throughout the year, but depositors may scarcely have noticed.

The Federal Reserve has pushed through five rate hikes since the beginning of the year, prompting a steady rise in market interest rates. Meanwhile, rates paid for deposits have not kept pace.

The trend is clearest for bank money market accounts. From the beginning of the year through the end of August, the federal funds overnight interbank borrowing rate jumped from 2.99% to 4.88%, a rise of 189 basis points. But bank money market accounts hardly budged, inching up just 13 basis points to 2.36%, according to Bank Rate Monitor.

Certificates of deposit rates were a bit more sprightly, but did not match increases in Treasury security yields. At yearend 1993, six-month Treasury bills paid 3.19% compared with 2.62% for equivalent bank CDs, a difference of 57 basis points. By the end of August, six-month T-bills were up to 4.84%, while bank CDs paid 3.44%, a difference of 140 basis points.

Across the full range of maturities, "banks have passed along to depositors only about 28% of the rise in market rates," calculated Lehman Brothers analyst Mark T. Lynch.

Such a pattern is typical during the early stages of a recovery, when businesses are just beginning to expand. "Loan demand is not sufficient to force banks to bid up rates," said Hugo H. Ottolenghi, editorial director of Bank Rate Monitor.

Bankers note that they can still fund loan growth by changing the mix on the asset side of the balance sheet. "We are picking up loans and running off investment securities," said Joseph R. Martinetto, asset-liability manager of First Interstate Bancorp.

But the stickiness of deposit rates also raises the touchy question of whether banks have gained oligopolistic control of the marketplace.

Some observers maintain that mergers and the decline of the thrift industry have reduced the competition banks face for savers' dollars.

"Banks have more pricing power than in the past because there are fewer competitors," said Ronald I. Mandle, analyst with Sanford C. Bernstein & Co.

Bankers don't like to talk about this politically sensitive issue, but privately they dismiss such concerns. "If we had higher demand for credit, we would all be out there competing for funds," said an official of a West Coast bank.

That argument is supported by regional variations m deposit rates. CDs pay higher in the Midwest - where business conditions and loan demand are strong - than in such lagging regions as California and the Northeast.

For example, a saver could get an average rate of 2.85% from Philadelphia banks for a six-month CD at the end of August, Bank Rate Monitor found.

But if that saver went to Chicago, he would have found banks paying an average of 4.16% on the same product.

Whatever the explanation, the restraint on rates is good for bank profits in the short term. Over the next several quarters, most analysts forecast flat-toslightly-higher margins at a time when loan volume is expected to continue growing, a recipe for solid gains in net interest income.

But analysts remind that later in the business cycle banks are likely to become hungrier for deposits and rates will climb faster. "We are forecasting declines in net interest margins at some point when banks run out of excess liquidity," said Norman Jaffe of FoxPitt Kelton. "When that crossover will take place, I can't tell you."

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