During an industry conference Tuesday, executives from PNC, Wells Fargo, JPMorgan Chase and elsewhere offered differing takes on whether the Republican tax plan will boost loan demand.
The Pittsburgh bank is counting on its acquisition of the Trout Group to help strengthen ties with clients in the life sciences, biotechnology, pharmaceutical and medical device sectors.
Third-quarter results from PNC, Bank of America, First Horizon and others suggest that demand for commercial loans may not be as weak as bankers and investors had feared. Or maybe some banks are just getting really good at poaching rivals’ customers.
Demand for commercial loans has been weak for much of the past year and among the big questions bank executives will face this earnings season is when they can expect the pace to finally pick up.
The first-of-its-kind study was an acknowledgment that as consumers rely more on digital banking channels, the nation's largest banks are competing more against each other and less against smaller institutions.
Flush with cash, many commercial firms are also opting to pay down debt rather than take on new loans, and those seeking financing aren’t always turning to banks to meet their needs.
Systems that run cash management services were built decades ago and prioritized functionality over user experience. That is starting to change as banks invest more heavily in digital upgrades geared toward commercial customers.
In a sign of broader competition ahead, bigger banks are raising the interest they pay on deposits held by business customers. The big question is how hard will it be for banks to maintain margins and to stave off consumer demands for better rates.
