8SEPTEMBER 2024OPINIONIN MYI never made it past the Cub Scouts, though the importance of that brief yet formative experience never left me: the notion of always being prepared. That has never been truer in the context of the liquidity issues that surfaced in the banking industry in March 2023. A conversation on the scarcity of liquidity within banking echoes these lessons we learn on preparation early on.Before I continue, I must give the standard disclaimer that the views I express here are my own and do not necessarily reflect the LIQUIDITY RISK MANAGEMENT IN BANKING ­ BE PREPAREDBy Charles Levingston, EVP, Chief Financial Officer, EagleBankviews of EagleBank (or any of its affiliates), its directors, or any of my colleagues at the Bank.1. Prevent crises with granular deposits from various customer profiles, including laddered term funding.An organization with various customers and product offerings is in a better position to withstand any potential disruption or concern over liquidity. As we saw in the Silicon Valley Bank failure, the dependency on venture capital deposits caused a specific and immediate run on the bank due to a contagion concern within that tight-knit industry. Avoiding those kinds of concentrations and having a wide variety of industries represented within a deposit portfolio can protect against discreet industry turmoil or concern.Charles Levingston
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