Impact of New Fed Chair on Major Banks
Written by Emily J. Thompson, Senior Investment Analyst
Updated: May 21 2026
0mins
Source: Fool
- New Leadership: Kevin Warsh took over as the new Fed Chair on May 15, promising to change the Fed's philosophy, which could significantly impact the profitability of major banks like JPMorgan Chase and Bank of America.
- Interest Rate Policy Impact: Warsh's interest rate policy is similar to Powell's, where low inflation maintains low rates; however, if rates rise, JPMorgan's loan costs will increase, potentially reducing demand and affecting profitability.
- Balance Sheet Adjustments: Warsh opposes the Fed holding short-term Treasuries and mortgage loans, and if he begins offloading assets, it could pull liquidity from the financial system, increasing the interest banks must pay depositors, posing a short-term challenge to profitability.
- Regulatory Easing Benefits: Warsh aims to reduce regulations that have burdened banks since the 2007-2009 financial crisis, lowering compliance costs and capital requirements, which could enhance bank profitability and promote lending and shareholder returns.
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Analyst Views on JPM
Wall Street analysts forecast JPM stock price to rise
19 Analyst Rating
11 Buy
7 Hold
1 Sell
Moderate Buy
Current: 296.730
Low
260.00
Averages
341.38
High
400.00
Current: 296.730
Low
260.00
Averages
341.38
High
400.00
About JPM
JPMorgan Chase & Co. is a financial holding company. The Company is engaged in investment banking, financial services for consumers and small businesses, commercial banking, financial transaction processing and asset management. The Company operates through three segments: Consumer & Community Banking (CCB), Commercial & Investment Bank (CIB), and Asset & Wealth Management (AWM). Its CCB segment offers products and services to consumers and small businesses through bank branches, ATMs, digital and telephone banking. Its CIB segment consists of banking and payments and markets and securities services, and offers a suite of investment banking, lending, payments, market-making, financing, custody and securities products and services to a global base of corporate and institutional clients. AWM segment offers investment and wealth management solutions. It offers multi-asset investment management solutions, retirement products and services, brokerage, custody, estate planning, and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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