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| Type | Working Paper |
| Scope | Discipline-based scholarship |
| Title | Cross-Selling in Bank Household Relationships: Implications for Deposit Pricing, Loan Pricing, and Monetary Policy |
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| Institution | University of Zurich |
| Series Name | Swiss Finance Institute Research Paper |
| Number | 22-65 |
| Date | 2023 |
| Abstract Text | Using administrative data on deposits and loans of every Norwegian resident with any Norwegian bank, we show that an existing deposit account makes a household more likely to hold deposits at the same bank later despite better alternatives and more likely to borrow there. Cross-selling potential varies by household and banks pay higher deposit rates to those more likely to become borrowers. Then they charge depositors higher risk-adjusted loan rates than new clients, suggesting that cross-selling is driven by demand rather than supply. Discounting future cross selling profits motivates lower deposit spreads in times of lower policy rates, transmitting monetary policy. |
| Official URL | https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4204984 |
| Other Identification Number | merlin-id:23136 |
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| Keywords | cross-selling, customer lifetime value (clv), relationship banking, switching costs, supply complementarities, demand complementarities, deposit pricing, loan pricing, deposit channel of monetary policy |