Bankers have to accept that much of their professional experience will be irrelevant in helping them deal with the future of their industry, says a senior academic economist.Rod Maddock, an adjunct professor at Monash University and former chief economist at the Business Council, said conditions in the decade leading up to the financial crisis must now be seen as anomalous.He said the high level of household borrowing that took place between 1998 and 2007 was unusual and not likely to be repeated any time soon.And bank deposit rates may remain at or above the cost of wholesale rates, rather than returning to the discounted levels banks enjoyed before the GFC, he said.Maddock is one of the authors of a paper, The Future Demand and Supply of Finance, written for the Australian Centre for Financial Studies and presented at a conference in Sydney yesterday.The paper says: "Historically and in most economies the household sector is a net saver. The period of increasing household leverage is only matched in our history by the run up towards the 1890s recession."Our central case assumption will be that households [will] maintain their current level of borrowing as a proportion of their disposable income."On the subject to deposit rates, Maddock said: "It always seemed strange that deposits cost less than wholesale funds. I think regulation is going to lock in a situation where retail and market rates stay close together."In such a scenario, banks have to plan for a future where they no longer have a funding advantage over other financial institutions."We are moving more to a US model, where banks play a smaller role in the financial system," Maddock said.The paper says: "It is not clear precisely where they [retail deposit rates] will settle; possibly priced at a slight premium [to wholesale rates] given the regulatory and ratings advantages of heavy dependence on sticky retail funding."Gradually the higher prices paid for retail deposits will erode the relatively cheap funding banks enjoy from their back books. The main overall effect... [will be] to reduce the advantage banks have had relative to markets."