The cost of government deposits for black-owned commercial banks
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This article utilizes a Statistical Cost Accounting Model and Mean Variance Model to estimate the cost and potential risk impact of government deposits for black-owned commercial banks. The main findings are that relative to other types of deposits on the balance sheet, government deposits are expensive, and that deposits received through the Minority Bank Deposit Program may have the effect of increasing risk in the asset portfolio.
KeywordsTotal Asset Balance Sheet Equity Capital Portfolio Weight Asset Portfolio
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- 2.See J. T. Boorman, “The Prospects for Minority-Owned Commercial Banks: A Comparative Performance Analysis,”Journal of Bank Research, 4 (1974) 263–267.Google Scholar
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- 10.A data appendix is available upon request from the author.Google Scholar
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