US Large Cap Banks Built for Higher Interest Rates
The US Federal Reserve's upcoming interest rate decision is causing market uncertainty, which can either benefit or harm some large-cap bank stocks. Three banks from Simply Wall St's screener appear well-positioned to weather the storm: Flagstar Bank National Association (FLG), Live Oak Bancshares (LOB), and Equity Bancshares (EQBK).
Flagstar Bank generates all of its revenue from domestic banking operations, making it a prime candidate for higher interest rates. Its business model is built around pricing credit and deposits, which would increase with rising interest rates.
Live Oak Bancshares also stands to benefit from higher interest rates, as its small business-focused bank relies heavily on interest income from loans and deposits. However, the company faces competition from non-bank fintech companies that can erode market share through superior technology and aggressive pricing.
Equity Bancshares runs Equity Bank, a regional lender with a traditional deposit-taking model. Its recent merger with NBC Bank expands its geographic reach into Oklahoma City, one of the Midwest's fastest-growing metro areas.