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Recent Rise in Long-Term Rates Bodes Well for Bank Profitability

^{Published on 2013-01-29 11:45:39 - Market Wire}
 

Recent Rise in Long-Term Rates Bodes Well for Bank Profitability -- NEW YORK, Jan. 29, 2013 /PRNewswire/ --

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NEW YORK, Jan. 29, 2013 /PRNewswire/ -- RateWatch, a premier banking data and analytics service owned by TheStreet, Inc. (NASDAQ: [ TST ]) reported today that interest rates for savings products are holding steady.  The average interest rate on a 5-year CD decreased by one basis point based on data collected from over 90,000 financial institution locations.

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Market yields for 10-year U.S. Treasury bonds reached the 2.00% line on Monday, for the first time since April 25 of last year, according to the Treasury's data.  The recent rise in long-term rates will eventually bode well for profitability for many banks, as yields on other long-term assets rise, although in the near term, a concurrent rise in mortgage backed securities yields means lower profits for banks on the sale of newly originated loans. 

It is too early in this rate cycle for the rising long-term rates to translate to higher deposit rates.  The Federal Reserve Open Market Committee in December said that it expected to keep its target short-term federal funds rate in a target range of zero to 0.25% for "at least as long as the unemployment rate remains above 6-1/2 percent," and as long as inflation projections remain within 0.5% of the central bank's long-term goal of 2%.

NATIONAL AVERAGE RESULTS - $10K

TOP RATE ISSUERS - $10K
This is a list of issuers with top interest rates.  The issuer's Financial Strength Rating isan independent, unbiased evaluation of quarterly regulatory statements. Institutions are assigned a letter grade of A-E with "A" representing the highest rating based on a review of many aspects of financial safety including capitalization, asset quality, profitability and liquidity. For more information, visit[ www.weissratings.com/help/what-our-ratings-mean.aspx ]. Information is believed to be accurate, but not guaranteed.

Data is surveyed weekly with averages calculated each Monday afternoon from RateWatch's unbiased national interest rate survey of over 90,000 financial institution locations across the United States.

About RateWatch  
For over 20 years, RateWatch has been the premier provider of competitive interest rate and product information to financial institutions across the United States.  Consistently providing top quality, highly relevant data RateWatch maintains the largest database in the industry with deposit, loan, and fee information monitoring over 90,000 locations. Rate surveys, product comparisons, financial strength reporting, local/regional/national averages, fee reporting, specialty reports and more are available.  To learn more about RateWatch, visit [ www.rate-watch.com ].  RateWatch is a division of TheStreet, Inc.

About TheStreet
TheStreet, Inc. is a leading digital financial media company that distributes its content through online, social media, tablet and mobile channels. The Company's network of brands includes: TheStreet, RealMoney, RealMoney Pro, Stockpickr, Action Alerts PLUS, Options Profits, Chat on TheStreet, MainStreet and RateWatch. For more information on TheStreet's business, visit [ www.t.st ]. For financial and business news, actionable trading ideas, stock quotes and more, visit TheStreet.com, follow TheStreet on Facebook and Twitter, and access TheStreet through all major mobile and tablet platforms.  For more information on The Deal, visit [ www.thedeal.com ].

Contact: 

Erin Corcoran  
TheStreet, Inc.  
212-321-5566  
[ erin.corcoran@thestreet.com ]  

RELATED LINKS
[ www.rate-watch.com ]

SOURCE TheStreet