Multimarket Bank Pricing: An Empirical Investigation of Deposit Interest Rates

28 Pages Posted: 28 Sep 2004

See all articles by Timothy H. Hannan

Timothy H. Hannan

Board of Governors of the Federal Reserve System

Robin A. Prager

Board of Governors of the Federal Reserve System

Date Written: June 2004

Abstract

In recent years, the number of large, geographically diversified banking organizations operating in the U.S. has grown. Empirical studies have found that, at least in the case of deposit interest rates, many of these banks offer the same rate for a given type of account throughout a state, or, in some cases, a broader geographical area. This phenomenon of uniform pricing raises questions as to what competitive factors are relevant in explaining the deposit interest rates offered by large multimarket banks. In this paper, we provide empirical evidence regarding the determinants of the deposit interest rates offered by these banking organizations.

Keywords: Banks, competition, pricing

Suggested Citation

Hannan, Timothy and Prager, Robin, Multimarket Bank Pricing: An Empirical Investigation of Deposit Interest Rates (June 2004). Available at SSRN: https://ssrn.com/abstract=596608 or http://dx.doi.org/10.2139/ssrn.596608

Timothy Hannan

Board of Governors of the Federal Reserve System ( email )

20th Street and Constitution Avenue NW
Washington, DC 20551
United States
202-452-2919 (Phone)
202-452-3819 (Fax)

Robin Prager (Contact Author)

Board of Governors of the Federal Reserve System ( email )

20th Street and Constitution Avenue NW
Washington, DC 20551
United States
202-452-3643 (Phone)
202-452-3819 (Fax)

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