For one, the demand for loans by businesses and consumers appears to be moderating, and there are some early indications that consumers are returning to bank retail deposits in the wake of disappointing stock and mutual fund results.
Still, many of these liquidity pressures are likely to remain in one form or another, and banks will almost certainly continue to explore nondeposit liabilities to fund asset expansion. While this is not new to community banks, the growing volume, variety, and complexity of non-deposit funds creates new issues.