MCB’s interest rate risk widens as funding turns costlier

Rotation into remunerated deposits and short-term borrowing raises liabilities’ sensitivity

Metropolitan Commercial Bank (MCB)’s funding base turned ever more costly in the second quarter, exposing income to a larger potential hit from further interest rate hikes.

Unremunerated customer deposits, which have dwindled since the bank announced it would stop servicing cryptocurrency-related businesses, plummeted by $392 million to $1.7 billion during Q2. The drop was more than offset by a $549 million surge in interest-bearing balances to $3.6 billion, ultimately leaving total deposits

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