Tariffs in Banking

Tariffs are influencing the banking sector as bankers navigate today's economic volatility. Tariffs are introducing complexities that impact lending, investment strategies, and overall financial stability across areas of the financial world. As a banker, it is essential that you understand the many ways that tariffs could impact your organization, including escalating trade tensions and shifting regulatory landscapes. Explore our comprehensive coverage, including news, expert analysis, videos, webinars, and market research to stay up-to-date in real-time on the latest tariffs news and insights for financial professionals.

Trump administration

Banks' commercial clients face whiplash over Trump tariffs

President Donald Trump's tariff policies will strain some banks' business customers, as their supply chains will have to be reconfigured. But uncertainty is the real headwind.

By Catherine Leffert

March 12
Trade agreements

Trump delays Canada, Mexico tariffs for goods under USMCA

The president exempted Mexican and Canadian goods covered by the North American trade agreement from his 25% tariffs, offering reprieves to America's two largest trading partners.

By Josh Wingrove and Jennifer A. Dlouhy

March 6
Trade agreements

Trump likely to defer tariffs on goods, services under USMCA

Commerce Secretary Howard Lutnick said the president is likely to defer his 25% tariffs on Canada and Mexico for all goods and services covered by the North American trade agreement.

By Josh Wingrove

March 6
Trump administration

Bankers in both Canada, U.S. mull threat of trade war

As steep tariffs on Canadian goods took effect this week, banks on both sides of the border expressed concern about the economic fallout and the uncertainty their customers face.

By Allissa Kline

March 5
Homebuilders

Trump to decide on Canada, Mexico relief today, Lutnick says

President Donald Trump is set to announce changes to the tariffs on Canada and Mexico he slapped on earlier this week, with potential relief for automobiles and other sectors, according to Commerce Secretary Howard Lutnick.

By Stephanie Lai, Enda Curran and Josh Wingrove

March 5
Earnings

RBC raises loss provision amid concern over U.S. tariffs

Canada's largest bank is bracing for the impact of a threatened U.S. 25% tariff on imports from north of the border. But the cloudy 2025 outlook was offset by strong results last quarter.

By Nathan Place

February 27
Trade agreements

Trump says Canada and Mexico tariffs ready, adds China duty

President Donald Trump's 25% tariffs on Canada and Mexico are on track to go into place on Tuesday and he plans to impose an additional 10% tax on Chinese imports, moves that would deepen his fight with the nation's largest trading partners.

By Josh Wingrove, Jenny Leonard, Skylar Woodhouse and Laura Dhillon Kane

February 27

Banks on deck for quarterly earnings amid tariffs mayhem: Live coverage

The first three months of the year coincide with the start of President Donald Trump's second term in office. Investors are likely to be more interested in banks' outlooks amid swings in tariff policy than the first-quarter results.

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Resources

The latest American Banker research and discussion on Tariffs

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Partner Insights from Finastra
Community banking

Regulation and compliance

Politics and policy
BankThink Raising the deposit insurance cap would benefit Main Street America

By Randy Chesler

October 22
Community banking

De novo institutions

Georgia
Organizers eye February opening for Atlanta-area de novo

By John Reosti

October 22

Frequently Asked Questions:

What proactive measures are banks using to mitigate the impact of tariffs?

Trade finance services and corporate client advisory on supply chain adjustments allow banks to lessen the impact of tariffs. For example, Citizens Financial’s trade finance unit helped companies accelerate inventory purchases and use letters of credit to secure transactions ahead of new duties. Many banks are also using hedging strategies and leveraging deregulation windfalls to address higher costs.

How should banks recalibrate interest rate forecasting and monetary policy expectations amid tariff-induced economic disruptions?

Banks can incorporate tariff-driven inflation and growth scenarios into their interest rate models and maintain flexibility in policy outlooks. Institutions are closely tracking Federal Reserve signals in this volatile trade environment, as tariffs can both slow growth and raise prices. This can put the Fed “in a quandary,” requiring banks to update their asset-liability strategies to account for potential rate cuts or even hikes.

What advanced compliance and technology strategies are banks using to optimize cross-border payments and trade finance?

Banks are deploying sophisticated payment analytics and real-time treasury tools to manage cross-border flows amid shifting tariffs. BNY Mellon, for example, notes clients are using predictive cash-flow analytics to navigate uncertainty. Institutions can also improve compliance automation by integrating systems for instant sanctions/tariff list updates. This can ensure cross-border transactions meet changing trade rules.

What are best practices in risk modeling and scenario analysis for banks to navigate tariff-related risks?

Leading banks can look to bolster scenario analysis capabilities to account for tariff shocks. Banks can run stress tests on portfolios with heavy exposure to tariff-impacted sectors such as automotive manufacturing and agriculture as well as model multiple trade war outcomes. Analysts also advise enhancing “playbooks” for varied economic scenarios and properly pricing new loans for added risk. For example, this could mean using forward-looking models to adjust credit loss provisions and capital plans.

How can banks prepare for long-term industry trends driven by tariffs and trade uncertainty?

Banks can prepare through incorporating trade policy shifts into growth investments as well as technology investments. This includes diversifying supply chain financing, investing in local manufacturing projects, and strengthening presence in resilient markets. Industry leaders like JPMorgan’s Jamie Dimon are watching the “restructuring of trade and tariffs” as an inflationary force shaping future strategy.

Which banking operational units should banks prioritize for tariff exposure assessments?

Commercial lending divisions, including those that finance manufacturers, agriculture, and exporters are a priority. These units will most directly face clients impacted by tariffs. Other units to review exposure risks include specialized trade finance and supply chain finance.

How is artificial intelligence (AI) helping banks address tariff-related challenges?

AI enables banks to respond faster and more efficiently to tariffs. Machine learning models can recalibrate pricing and supply chain finance strategies as trade policies shift. Generative AI tools can shorten the time needed to update payment systems for new tariff rules update payment systems for new tariff rules. AI-enabled platforms can make compliance a proactive function by automating real-time screening of transactions against changing trade restrictions.