My answer is that it does. When interest rates decline, NIM goes down, because lending rates decline quicker than deposit rates. The reverse is true when rates rise.
My answer is that it does. When interest rates decline, NIM goes down, because lending rates decline quicker than deposit rates. The reverse is true when rates rise.
I had the impression that the problem was that certain deposit rates can't easily fall below zero. As rates fall more account types hit this barrier. This squeezes the deposit margin achieved. Its a lot less of an issue for finance companies because most of their NIM is made on the lending side and zero interest deposits are not a big source of funding for their loans.
I had the impression that the problem was that certain deposit rates can't easily fall below zero. As rates fall more account types hit this barrier. This squeezes the deposit margin achieved. Its a lot less of an issue for finance companies because most of their NIM is made on the lending side and zero interest deposits are not a big source of funding for their loans.
You're right on this one for HGH, but I think it trades in line with AU banks, and their shares prices move up and down in line with their NIMs. Not a perfect relationship though. However I have seen short-term rates move up this week at two banks - 0.25 bps in one case, with the same bank offering a record low mortgage rate. Mayne just a short-term attempt to capture market share.
Bull break of the 170 resistance. US financials have been performing very strongly in the last week so suspect this is a catalyst. Next strong resistance level is around 190.
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