Navigating the turn: bank profitability in the next leg of the rate cycle

Video insights: What's next for the banking and capital markets industry?

With an expected turn in the interest rate cycle, banks are grappling with questions about the speed, depth and impact of rate cuts. Rising deposit costs and a lack of loan growth have put pressure on banks' profitability, while continued uncertainty around the larger economy and a shifting competitive landscape add to the challenge.

Will rate cuts inspire loan growth and enable profitability tailwinds for the banks? Will credit concerns be manageable or could the environment deteriorate further? Can banks benefit from lower rates without losing customers and their deposits? How are these challenges different for the largest banks versus everyone else — and what role could private credit play?

With only so much to invest in the business, banks will need to prioritize how to better allocate their resources, pursue growth and increase efficiency — all while managing the interrelationships between capital, liquidity and sensitivity to rate movements.

Watch PwC’s Ashish Jain and Chris Tsingos explore these topics in the first of our video series. And then talk to us about your bank’s challenges navigating today’s rate cycle.

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Ashish Jain

Principal, Strategy& US

Christopher Tsingos

Principal, Cyber, Risk & Regulatory, PwC US

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