US Banks Cash in on Higher Interest Rates

The Federal Reserve's rate hikes have created opportunities for US financial stocks tied to client cash and short-term yields. Three companies, First Community (FCCO), Peoples Financial Services (PFIS), and Northrim BanCorp (NRIM), are benefiting from this trend.

First Community, a community bank based in Lexington, generates about $68 million from commercial and retail banking, with smaller contributions from mortgage, investment advisory, and other US segments. Its market cap is around $321 million. The company's Q2 2026 net interest income of $19.5 million and net income of $7.6 million both gained meaningfully year on year.

Peoples Financial Services, a regional bank holding company, takes client deposits and lends to households and businesses across Pennsylvania, New Jersey, and New York. It also offers wealth management and fiduciary services that link client cash and investments to prevailing short-term rates. The company's market cap is around $721 million.

Northrim BanCorp, an Anchorage-based commercial bank, gathers client deposits and lends to businesses and households across Alaska. Its Q2 2026 net interest income of $37.14 million and net income of $15.34 million are both in a Fed tightening cycle that now points toward a 4.0% to 4.25% policy range.