In-depth analysis on Credit Writedowns Pro.

Zero rates are now killing regional bank profits… as predicted

Two years ago, I noted that the steep yield curve produced by the Fed’s policy accommodation would give way to a flatter and more treacherous yield curve environment as a weak recovery continued. The Fed would see the weak recovery as a reason to keep rates at zero percent and, thus, cause interest rate expectations to decline. With rates stuck at the zero bound that would mean less interest income for banks and lower profits.

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Edward Harrison is the founder of Credit Writedowns and a former career diplomat, investment banker and technology executive with over twenty years of business experience. He is also a regular economic and financial commentator on BBC World News, CNBC Television, Business News Network, CBC, Fox Television and RT Television. He speaks six languages and reads another five, skills he uses to provide a more global perspective. Edward holds an MBA in Finance from Columbia University and a BA in Economics from Dartmouth College. Edward also writes a premium financial newsletter. Sign up here for a free trial.