American Banker writes "Banks have a mountain of deposits, so they don'​t need PPP funding," explaining that, "A record surge in bank deposits has given U.​S. lenders more cash than they know what to do with. One thing they don'​t need: help from the Federal Reserve to fund the government-​backed loans they made to small businesses.... That'​s largely because lenders are sitting on $​1.​8 trillion of new deposits that have flooded in since March 11 -- a 13% increase, and the biggest two-​month jump since at least 1973, when comparable data is available." They quote Keefe, Bruyette & Woods' Brian Klock, "It looks like this excess liquidity in the banking system is going to stick around much longer. So if you don'​t really need it, why get the Fed loan?" The article explains, "Deposits have surged as drops in securities markets and interest rates for bonds and money market funds pushed savers and investors to banks. Also, a jump in corporate borrowing amid the pandemic has ended up as deposits back at the banks. The Fed loans are pretty cheap at 0.​35%, but then deposit costs have gone down considerably as well. Interest-​bearing deposits cost JPMorgan Chase 0.​52% in the first quarter, and Bank of America paid 0.​47% while the average was around 1% for smaller lenders. Meanwhile, non-​interest-​bearing accounts made up about 30% of all deposits at the four biggest banks, giving them cheaper funding than the Fed'​s rate. Among the top U.​S. firms, only Citigroup'​s name showed up on the list of 574 banks that used the Fed'​s lending facility as of May 6.... It had the highest deposit cost among the four biggest banks in the first quarter at 1.​1%, and the smallest deposit base."

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