The bank collapse prompted an outflow of deposits from smaller regional banks — and plenty of that cash landed in money market funds. The shift underscores the pressure that regional lenders — big sources of investment capital in some metro areas — continue to face.More than $300 billion has poured into money market funds over the last three weeks, driving the total assets invested to over $5 trillion.
Newly attentive depositors are likely to have noticed that average money market yields trounce those offered by bank savings accounts . As a result, cash is likely to continue moving that way for a while, according to analysts, even if the surge driven by recent bank worries starts to decelerate."Continued inflows into money market funds are quite likely, but at a slower pace," Goldman Sachs analysts wrote in a note yesterday.