In the wake of the recent back-to-back collapses of three smaller banks, fear has gripped depositors who are worried that the crisis may spread. As a result, the largest banks in the US are experiencing a surge in deposits from anxious customers seeking to protect their funds.

Reports suggest that JPMorgan Chase & Co., Bank of America Corp., Citigroup Inc., and Wells Fargo & Co. have all received unusually high volumes of deposits in recent days. However, representatives for these banks have either declined to comment or failed to respond to messages.

The financial crisis that occurred over a decade ago highlighted the vulnerability of the US banking system, which prompted the realization that the top six banks in the country are too big to fail. As a result, depositors are now seeking safer alternatives, such as banks with a higher degree of certainty, according to Michael Imerman, an assistant professor at the University of California Irvine’s business school.

This trend is evident from the recent seizure of Silicon Valley Bank, which was the largest US bank failure since the financial crisis. The bank’s collapse was triggered by depositors who withdrew their funds, causing ripple effects throughout the global financial system.

Regulators have responded to these challenges by implementing measures to shore up deposits, following the news of Signature Bank‘s failure. Furthermore, Silvergate Capital Corp. announced last week that it would wind down, adding to the growing concerns about the stability of the banking system.

The repercussions of the financial crisis have highlighted the importance of taking proactive measures to protect the banking system from such shocks. To this end, regulators are devising strategies to ensure that depositors have greater confidence in the banking system. These measures include increasing the level of scrutiny on banks, enforcing stricter regulatory controls, and enhancing deposit insurance coverage

In contemporary times, a surge in deposit inflows has been observed, not only in the top six banks but also in Citizens Financial Group Inc., signifying an unprecedented interest from potential new clients. As a consequence of this massive influx, the bank has deemed it necessary to extend branch hours temporarily to cater to the growing demand.

The collapse of several banks has had a momentous impact on the financial sector, leading to a noticeable escalation in deposits for the largest banks in the United States. Given the prevalent fear and uncertainty surrounding the crisis, depositors are gravitating towards safer options, such as banks with a higher degree of certainty. These developments are anticipated to have far-reaching implications for the banking industry, and it remains to be seen how regulators will respond to the situation.