I seem to recall from a financial management course I took eons
ago that banks, by law, have to keep a certain percentage of their
customer deposits liquid in case there's a run on the money by
customers. Keeping these funds liquid satisfies the safety
criteria, but since the bank isn't investing the money, it isn't
earning any returns on them, which negatively impacts their
profitability.
Not sure if that's the correct explanation, though...
