A clutch of U.S. regional lenders saw deposits drop in the first-quarter as clients reeling from a crisis of confidence in the banking sector moved to bigger institutions and sought refuge in money market funds.

The flight of deposits at Fifth Third Bancorp, Comerica, Truist Financial Corp. and KeyCorp dampened gains that the lenders made in their interest income benefiting from the U.S. Federal Reserve's aggressive monetary policy tightening through the past year.

Only, Huntington Bancshares Inc., among banks reporting on Thursday, managed to grow average total deposits by $472 million from the prior quarter.

Huntington gained 1.7% in premarket trading after the results, while the others were down between 1% and 3.4%.

Investors have focused on the balance sheets of smaller lenders to gauge the full impact of the banking turmoil in March. In the aftermath, the KBW Regional Banking Index has tumbled 19.4% this year, through previous close.

Deposits outflows have been at the center of investor concerns after bank runs last month at two mid-sized rivals sparked worries of sector-wide instability.

Wall Street lending titans Bank of America, Citigroup and Wells Fargo and Co. also reported deposit declines between 1% and 3% in the quarter as the banks remain sluggish in raising rates it pays depositors.

Clients are expected to continue the shift toward other assets that bring in higher returns unless the banks increase returns, analysts have said.

Deposits in 2023 are expected to decline about 12% to 14% year-over-year, Comerica finance chief said in a call on Thursday.

Citizens Financial on Wednesday cut its forecast for net interest income, expecting an increase in the rate it pays out for deposits to clients.