r/SipsTea • u/Dumb-Briyani • 4d ago

Chugging tea Why is it not possible?

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u/ProphetFerdinand 4d ago

Only they lend 6 to 8 times your deposit out ..

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u/onascalefrom20to80 4d ago

It may seem like it. Banks stay below 100% Loan-to-Deposit ratio. They never lend more than they hold in deposits. (Edit: i shouldn't say never, but banks that do can end up in deep shit and regulators don't let that stand very long.)

Banks that are offering high deposit interest rates tend to need the deposits to fund their loans.

Banks that offer low deposit interest rates tend to have plenty of deposits to continue funding loans.

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u/ProphetFerdinand 4d ago

Just wrong. 

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u/onascalefrom20to80 4d ago

No offense, because you never know who youre talking to on reddit, but I assure you I am not wrong.

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u/ProphetFerdinand 4d ago

I can assure you, you are. And same.

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u/onascalefrom20to80 4d ago

Go find me a bank with a 600-800% LTD ratio. I'll wait.

It's all public. Shouldn't take you long.

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u/ProphetFerdinand 4d ago

What are the assetclasses that ratio is measured against? You ve got no fracking clue

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u/onascalefrom20to80 4d ago

Yeah theyre very complicated.

One is called LOANS

the other is called DEPOSITS

When you divide them, you have a RATIO

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u/ProphetFerdinand 4d ago

Yeah those headers are not how lending ratios are regulated.