The corporate finance leaders that place their substantial business deposits with U.S. banks hold lingering jitters about safety and soundness, and they will forgo a degree of return for greater confidence, according to one recent survey. That same survey, conducted by Milwaukee area-based treasury management firm Ampersand Inc., also showed a heightened interest in liquidity and other flexibility features.
Priority for liquidity was more important to respondents this year than when asked the same question in the company’s inaugural survey a year earlier. Business leaders told Ampersand that some of the same pain points persist from recent years. This includes what corporate finance leaders feel has become burdensome loan requirements and the hurdles depositors must undertake if they want to change financial institutions.
The safety and soundness concern is not in doubt: 9 out of 10 depositors cited this worry. And, 7 in 10 depositors have gone so far as to make changes to their deposit behavior in recent years because of this concern.
Depositors also said their experience with their financial institution would be vastly improved if they were assured of liquidity. Some 43% of depositors surveyed cited this as a key concern as they review their banking practices for the future.
BAI talked with Ampersand Chairman and CEO Kelly Brown about what motivations she thought were behind the emphasis on liquidity now unlike than before. She said more than one factor could be at work.
“As a reflection of continued fear regarding bank safety and soundness, depositors want to ensure that their cash is available and liquid should they feel they ‘need’ to pull it out,” she said, emphasizing the survey’s leading response.
And, Brown added: “These respondents are representative of large corporate depositors and perhaps based on the current economic climate around things like tariffs, their business may want to have a larger portion of liquid cash on hand to support them during business transitions.”
The full survey results, based on responses from leading executives and senior managers across industries involved in deposit administration, can be found here. The survey, held in late 2024, draws on answers from over 250 executives or senior managers involved in the administration of cash deposits on behalf of their employers or their clients, including those in the healthcare, insurance, hospitality, retail and professional and business services sectors, among others.
A few additional key findings include:
Bank loan requirements continue to be a major issue for depositors. 61% of respondents say that they are limited in their ability to select a financial institution because of loan requirements, a dramatic increase from last year’s survey where 28% of respondents reported the same.
Alignment with depositors’ values is increasingly important. 88% of financial services professionals agree that demand for values-based banking products has increased in recent years, with 9 in 10 depositors stating they are willing to give up a portion of their return if their financial institution can guarantee deposit safety while being values aligned.
According to Brown, banking relationships, including communicating values and efforts toward safety and soundness, cannot be an afterthought even as the deposits business digitally transforms to favor speed and ease. And as quality deposits will stay with a bank or credit union long past any interest rate chase.
“It’s fairly simple when you break it down. Corporate financial decisionmakers are willing to sacrifice some amount of return to ensure their banking partner’s values are aligned with theirs — whatever that means to them,” she told BAI. “Supporting the community they do business in, supporting key initiatives that align, in this regard, pursuing safety and soundness is a form of corporate social responsibility that is easy to pull the lever on.”
Rachel Koning Beals is Senior Editor with BAI.
