Deposit-Cost & Beta Sentinel · Brief 02
Deposit-Beta & Margin Review · Paying Up, Book Flat
Affluent-uninsured, network-wide · WA FD Rate climbing against a flat book
The one line you configure
Which cohort's cost of funds has climbed over recent weeks while its book stayed flat, and how much is that repricing costing NIM?
In a nutshell
Across recent weeks the Affluent-uninsured book repriced: WA FD Rate climbed 4.49% to 6.35% (1.41×), interest paid rose ~36%, and CASA savings interest up 3.84× — yet its book stayed flat (0.96×) week over week and Net CASA Flow stayed negative. That's textbook deposit-beta margin compression, softening most in the Northeast where NIM is thinnest at 1.79%. The flat book is the tell that rules out 'interest rose because we grew'.
At a glance
WA FD Rate climbed all quarter while the book stayed flat
Rate up, margin down — the weekly scissors
Every week the rate stepped up, NIM stepped down — with the book flat throughout, the whole move is deposit-side margin given away, not growth funded.
Where the quarter's compression concentrated · by region
The Northeast pairs the highest FD rate paid with the lowest NIM — the clearest regional read on where a quarter of paying-up compressed margin the most.
Why weekly is the right lens
A single day's rate looks like a rate sheet; only the multi-week trend shows the book flat while the rate climbed. Deposit beta is a trend, not a spike — so it's a weekly review, with the day-one repricing steps flagged in the daily cost-of-funds brief.
So what
Read across the quarter, the three books tell one story: rate-shopping pressure led, the branch raised FD and CASA rates week after week, interest paid climbed ~36% — and the FD book stayed flat while Net CASA Flow stayed negative the whole time. The bank paid more for balances it already had and still bled. This is deposit beta, not growth, concentrated in the Affluent-uninsured cohort and the Northeast margin.
The points that matter
A trend, not a blip
The rate climbed eight straight weeks while the book never grew — a day looks like a rate sheet; the quarter is deposit beta.
8 wksrate ↑, book flatPaid more, didn't grow
Interest paid +36% with the FD book flat (0.96×) and Net CASA Flow negative every week — the deposit-beta trap.
+36%interest paidThe fix is targeting, not more rate
Defend only the tier actually leaving; hold the rest on relationship — the flat book says the blanket hikes bought nothing.
0.96×book flatRecommendation
Stop the blanket rate hikes that aren't retaining. Target rate defence only where retention-per-bp is real (the at-risk Affluent money-market tier), and compete on relationship and service where it isn't — the flat book across the quarter says the broad repricing bought nothing. DataGenie surfaces and explains — the pricing decision stays with treasury.
Questions it already answers
Was the quarter's repricing driven by real yield pressure or something else?
Yield — rate-shopping rose ahead of each week's repricing and outflow ran to external yield destinations, not first-payees. Beta, not fraud.
How much of the book actually needed the higher rate?
A narrow, rate-sensitive slice; most of the cohort held at the old rate all quarter, so the blanket hike repriced balances that weren't leaving.
Does a targeted hold on the at-risk tier recover NIM more cheaply than another blanket move?
Yes — a targeted rate move on the at-risk tier plus a relationship play elsewhere holds the flight-prone balances at a fraction of the blanket NII cost.