With the Fed having released the minutes from its Federal Open Market Committee earlier this week, investors heard the news that the third round of quantitative easing, QE3, may end earlier than expected. Several banks fell on the news, because of investor fears that interest rates would rise as a result. In this video, Motley Fool financial analysts Matt Koppenheffer and David Hanson discuss the idea of how banks "borrow short and lend long," and why rising interest rates could hurt banks on the "short" financing end long before they help on the "long" lending end. Matt and David then highlight four big banks with a low loan to deposit ratio that will be ready to deploy a lot of new loans quickly under new interest rates, and cash in on the rise.
Four big banks ready to rake in profits from higher interest rates.
About the Author
Matt Koppenheffer is the former Head of the Coverage Team at The Motley Fool. He was a full-time Motley Fool employee from 2012-2025 and is a former advisor and analyst for multiple Motley Fool services. Matt's articles and analysis have been published around the world and his views have been cited in worldwide publications from the Financial Times and The New York Times to the Toronto Star and Germany's Focus Money. He has appeared to offer analysis on a variety of outlets including CNBC and NPR. Matt is the co-author of The Astonishing Collapse of MF Global as well as the creator and former co-host of The Motley Fool's Industry Focus podcast.
