On the face of it, this is not true; net interest margin is still the main profit driver, followed by fees. But besides that, retail deposit customers are a conversion funnel for more lucrative financial products such as credit cards and personal loans.

And besides that, banks need capital reserves in the form of customer deposits; if too much money flows out then they will have to either acquire customers or pause their real moneymaking activity (loans).

Your account doesn't make them significant money. Retail banking in general makes boatloads of money, and deposits are central to this now that we're out of zero-interest-rate-land.

If banks didn't make money on customer accounts they wouldn't offer customer accounts.

Maybe. But I still have to find a bank where you say you’re leaving and they say “oh ok, here’s your account balance, there’s the door”.

The main thing is that they do care about retention.

As long as they keep other people’s money, they make money on it.