Bank Stocks Fall On Rate Cap

Benzinga

U.S. bank stocks fell as investors weighed whether President Trump’s proposed 10% cap on credit card interest rates could take effect without legislation. The administration said the move would improve affordability, while banks warned it would restrict credit availability by limiting risk-based pricing and pressure interest income. JPMorgan, Citigroup, and Wells Fargo led declines, with broader weakness across large financials. Analysts said issuers may respond with no-frills cards, reduced rewards, tighter credit limits, or higher fees if the cap is enforced. Uncertainty around implementation continues to drive volatility in bank shares.

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00:00It's Benzinga bringing Wall Street to Main Street

00:02U.S. bank stocks fell on Tuesday as investors awaited whether Trump's deadline to implement

00:07a 10 percent cap on credit card interest rates would take effect, according to Reuters.

00:12The administration said the proposal would improve affordability, while banks warned

00:16it would restrict credit availability by limiting risk-based pricing.

00:20Trump called on companies to comply by Tuesday, but it remained unclear whether the cap could

00:24be imposed without legislation.

00:26JPMorgan shares fell 3.1 percent, Citigroup dropped 4.4 percent, and Wells Fargo declined

00:331.9 percent, while Morgan Stanley and Goldman Sachs also posted losses.

00:37Executives and trade groups said the cap would reduce access to credit, pressure interest

00:42income, and lead to higher fees or fewer approvals.

00:45Analysts said card providers could respond with alternatives such as lower rates for some

00:49customers, no-frills cards charging 10 percent without rewards, or reduce credit limits.

00:55For all things money, visit Benzinga.com.

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