US Banks Are Relying on a Pricey Fix to Their Declining Deposits Problem

US banks turned to brokered deposits and FHLB loans as a quick — and expensive — solution to the hundreds of billions of dollars in cheap deposits that flooded out their doors earlier this year. Those rising costs of “hot money” now threaten to turn the most strained banks upside down, leaving them paying more to amass the cash they need than they earn by lending it out. Next month, investors will finally see just how big a toll it’s all taking on banks’ earnings.