Why it might be time to buy banks
Just not in America
![Illustration of a bank in the form of a downward pointing arrow](https://www.economist.com/cdn-cgi/image/width=1424,quality=80,format=auto/content-assets/images/20231209_FND003.jpg)
Who would want to own shares in a bank? Rising interest rates should have been a blessing, lifting the income they can earn on assets. But a few banks that had lent and invested freely at rock-bottom rates faced runs, which pushed up funding costs for the rest. More may yet fail. And new regulations, ominously named Basel 3 “endgame” rules, could raise the capital requirements on some American banks by as much as a quarter if they are introduced in their current form in 2025. This would scupper any chance that shareholders can be paid much out of profits, perhaps for years.
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This article appeared in the Finance & economics section of the print edition under the headline “A cheap shot”
Finance & economics December 9th 2023
- Will China leave behind its economic woes in 2024?
- Will a fiscal mess thwart Japan’s nascent economic growth?
- How to sell free trade to green types
- Why it might be time to buy banks
- Is the world’s most important asset market broken?
- Who made millions trading the October 7th attacks?
- At last, a convincing explanation for America’s drug-death crisis
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