's (NYSE: KEY) stock has dropped by nearly a third so far in 2023. The vast majority of that fall was related to the banking crisis early in the year, when a number of regional banks faced runs that put them out of business. KeyCorp has held up fairly well, with deposits down just 3.1% year over year in the second quarter. But there's more to this story than total deposits.

Modern banks are complex, but the core of the business is fairly simple to understand. KeyCorp takes in deposits from customers and then lends the cash out to other customers. It pays depositors interest for the cash they keep with it. It charges borrowers interest for the loans it makes to them. The bank's profit is the difference between the interest it charges and the interest it pays. Again, that's a simplification, but it gets to the core of the story.

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Source Fool.com