3-6-3 Rule: Slang for How Banks Used to Operate

What the 3-6-3 Rule Means

The “3-6-3 rule” is a jokey shorthand describing how U.S. commercial banks allegedly operated in the 1950s–1970s: pay depositors 3% interest, lend at 6% interest, and be out playing golf by 3 p.m. It captures a period of limited competition and predictable profit margins driven by tight regulation.

Key points

• The rule summarizes a simple profit model: earn a spread between lending and deposit rates.
• The net interest rate spread is the difference between what a bank earns on loans and what it pays on deposits.
• The phrase reflects a calmer, less competitive era in banking, not an exact policy.

Why the Rule Emerged

After the Great Depression, U.S. banking was heavily regulated to limit risk and instability. Regulations constrained interest rates and the scope of banking activities, which:
* Limited interbank competition.
* Made lending and deposit rates relatively uniform.
* Encouraged conservative, relationship-based banking rather than aggressive competition for business.

Why the Rule Stopped Being Accurate

Starting in the 1970s, regulation loosened and financial markets changed. Factors that ended the 3-6-3 era include:
* Deregulation of interest rates and expanded powers for banks.
* Increased competition from nonbank financial firms and between banks.
* Technological advances that enabled new products, more efficient operations, and 24/7 access to markets.
As a result, banks now offer a wide range of rates and services and cannot rely on a fixed spread or a leisurely workday.

Modern Banking Practices

Today’s banks operate with greater complexity and competition and commonly offer:
* Retail banking: checking and savings accounts, mortgages, personal loans, debit/credit cards, and CDs.
* Commercial banking: loans and services for businesses.
* Investment management: institutional asset management, IPO access, and alternative investments.
* Wealth management: tailored services for high-net-worth clients, including investment advice, tax planning, and estate planning.

Banker’s Hours

The related expression “banker’s hours” refers to a shorter workday historically associated with banks (roughly 10 a.m.–3 p.m.). Modern banking hours are longer and far less uniform due to branch networks, online services, and extended customer access.

Bottom line

The 3-6-3 rule is a colorful, outdated shorthand for a regulated era when banks earned predictable spreads and faced little competition. Changes in regulation, markets, and technology have made banking more competitive, diversified, and fast-paced, rendering the rule more myth than reality.