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Deposit Costs

All articles tagged with #deposit costs

finance1 year ago

Bank of America's Profits Decline Due to Weakened Lending and Interest Income

Bank of America's first-quarter profits dropped 18% due to a 3% fall in net interest income, impacted by higher deposit costs outweighing higher asset yields and modest loan growth. This reflects the challenges faced by major banks, including JPMorgan Chase, Wells Fargo, and Citigroup, as they struggle with higher interest rates. Despite this, Bank of America saw growth in its Wall Street operations, with record revenue in wealth management and a 35% increase in investment banking revenue compared to last year.

via Yahoo Finance|
#bank-of-america#deposit-costs#finance
finance2 years ago

Challenges and Opportunities for Regional Banks in the US

Several regional banks, including Zions, Discover Financial, and Truist, reported significant drops in profit during the third quarter due to higher deposit costs and rising loan losses. While regional banks have stabilized since the spring, profitability remains a challenge as high interest rates increase deposit expenses and make it harder for borrowers to repay loans. New capital requirements proposed by US regulators also threaten future profits. Regional bank stocks have underperformed the S&P 500 this year. Net interest income, a key measure of profitability, is being squeezed by higher interest on deposits.

via Yahoo Finance|
#deposit-costs#finance#interest-rates
finance2 years ago

U.S. Banks Brace for Interest Income Weakness Amid Upbeat Quarter

Comerica and Huntington Bancshares have lowered their interest income growth forecasts for 2023 due to faltering loan demand and rising deposit costs. While the Federal Reserve's tightening cycle boosted net interest income in Q2, high interest rates are causing some customers to reconsider taking loans and making big purchases. Lenders are also increasing deposit rates to prevent money from flowing into high-yielding alternatives, which will impact net interest income going forward. Regions Financial also reported increased deposit costs in Q2. Comerica and Huntington have revised their NII growth expectations, causing their stock prices to decline. The industry remains cautious due to uncertainties surrounding potential capital requirements and is holding off on buyback plans.

via Reuters|
#deposit-costs#finance#interest-income