Since August 2007, the U.S. and global financial markets have endured the worst crisis since the Great Depression, accompanied by a deep economic recession. At the height of the crisis, whole segments of financial markets froze and market participants hesitated to engage in transactions with...

The authors show how the relationships between interest rate changes, deposit growth rates, and loan growth rates have changed in the last ten years, discuss some possible reasons, and assess the likely impact of rising interest rates on loans and deposits going forward.