Net interest margin

Commercial lending provided a boost for some regional banks in the third quarter, but further rate cuts and a slowing economy could challenge future growth.

The Dallas company also warned of a decline in net interest income this quarter due to the anticipated impact of Federal Reserve interest rate cuts on loan yields.

Its quarterly results show lower rates and emerging credit risks can be overcome. Whether most banks have all the same levers to pull is another matter.

Community banks will likely face questions about mortgage lending, deposit gathering and M&A during earnings calls.

Even with fee revenue already down, Oregon-based Providence FCU has cut its overdraft fees by half. Some analysts say the move could pay off if the economy goes south.

Bankers are expected to field numerous questions on third-quarter earnings calls about the threat of shrinking loan yields, stubbornly high deposit prices and what they're going to do about them.

CEOs have been telling investors that if the Fed continues to cut interest rates, they will lower rates they are paying on deposits to minimize the hit to net interest margins. The danger is that if they lower rates too quickly or by too much, big depositors could go elsewhere.

Expectations of more rate-cutting and slower GDP growth led the Minneapolis company to scale back its net income and revenue projections through 2022.

M&T has skillfully used hedges, maintained an appropriate loan mix and resisted offering market-leading deposit rates, its chief financial officer said at a financial services conference.

For the third time in five months, the San Francisco bank made a downward revision Monday to its guidance on net interest income. An executive cited the impact of lower interest rates.