“The acute phase of bank stress is over, but a long and winding road remains,” Wedbush analyst David Chiaverini said in a Monday research note. Many banks also still face pressures from high interest rates and the possibility of stronger capital requirements for banks with more than $100 billion in assets, which will make it more difficult to earn robust profits.Įarlier this month, a number of US bank executives revised down their estimates of net interest income, the crucial margin between what banks make on their loans and pay for their deposits. Their deposits have fallen 6% since a peak in April 2022. Commercial banks have regained approximately $99 billion in deposits since the second week of May, according to data released Friday by the Federal Reserve. The index closed 5% lower last Friday and slightly lower the previous week.Īnother positive note for banks is that their deposit withdrawals have stabilized.
For the period, the KBW Regional Bank Index ( ^BKX) has gained 9%, outpacing the S&P 500. But since then, those stocks rallied for four of the last six weeks on optimism that the worst was over for regional banks.
