Interest rates

Other banks likely will follow the lead of the Richmond, Virginia, company and tap the equity in their branch networks as alternative sources of capital grow more costly, experts say.

The Fed's meteoric increase in the federal funds rate over the last 18 months has left banks holding billions in unproductive investment securities. Helping them would be good for the economy.

Credit cards and auto loans both showed weakness in the second quarter, leading to an uptick in delinquencies and charge-offs for U.S. credit unions.

The Consumer Financial Protection Bureau issued a mortgage report based on statistics from 2022 and is looking for ways to simplify the refinance process while considering changes to mortgage servicing standards.

The JPMorgan Chase CEO's comments contrast with the consensus view after 5.25 percentage points of hikes that lifted the benchmark rate to 5.5% — the highest level in 22 years. Money markets are pricing in cuts from next year.

A Piper Sandler poll found that 91% of respondents believe that either a mild or severe recession is already reflected in banks' shares. The survey also unveiled that market participants remain concerned mostly about credit quality and aftershocks from surging interest rates.

The Federal Reserve's rate hikes so far are just "catching up," the JPMorgan chairman and CEO says. Dimon predicts inflation will be at 4% early next year and "won't be coming down for a whole bunch of reasons."

Concerns about large unrealized losses on bond investments have receded since the spring banking crisis, but the paper losses have started growing again in recent months. The worries today are less about banks' survival — and more about how much their margins will get squeezed.

When the prices of U.S. goods and services soar, the Federal Reserve tends to raise its benchmark interest rate, and commercial banks are pinched in several fundamental parts of their business.

Consumer loan balances fell in July for the first time since 2020 as banks have tightened lending standards in response to rising rates and jettisoned assets to bolster liquidity and capital levels.