Behavioural maturity
What is behavioural maturity, and how long do bank deposits really stay?
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BY MICHAEL SHANG · SIXTEEN YEARS IN COMMERCIAL BANKING · UPDATED
// THE SHORT ANSWER
Behavioural maturity is how long a deposit or a loan is expected to stay on a bank's balance sheet in practice, as opposed to its contractual term. Transaction and savings accounts can be withdrawn on demand, yet a stable core of them stays for years, so treasury models that core as longer-term funding for transfer pricing, liquidity and interest rate risk, and supervisors usually limit how far those assumptions may go. The danger is relying on behaviour that changes under stress: depositors who stay put in normal times can leave within days once they doubt the bank.
BASIS Practitioner judgment from sixteen years in commercial banking, set out in How Bankers Think (Highbank Press, 2026). Every borrower on this site is a composite constructed for teaching, not a client. The market is mid-market commercial lending as practised in New Zealand and Australia; where a convention differs elsewhere, the page says so.
// WORKED IN
// NEXT TO IT
- Maturity transformation
- Risk-weighted assets
- Net interest margin
- Credit cycle
- Yield curve
- Cost of risk
- Management overlay (provisions)
- Notional pooling
- Zero-balancing (cash concentration)
- Confirmation of Payee (CoP)
- Business email compromise (BEC)
- Credit conversion factor (CCF)
- Four-eyes principle (maker-checker)
- Deposit beta
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