Banks posting huge profits. Will they reduce margins?

treliac

Malcolm. wrote: »

I love HSBC. My mortgage is with them.

Mine too.... they only want good customers.

StevieJ

JonnyBravo wrote: »

It'll be a slow creep down in margins. It'll take years. 10 years at least til we see what we became used to in the middle years of the 00's.
It's not like the 0.1% margins came into existence overnight anyhow.
If one bank suddenly slashed it's margins it wouldn't be able to cope with the amount of business it would get.

I think margins will fall when interest rates rise, whenever that is.

michaels

If this is the HSBC love in thread, count me in (see sig).

It must be nice to be seen as more credit worthy by savers and get your funds for a lot less than the competition and then cherry pick the most credit worthy borrowers - a nice easy way to mint money on the spread.

Thrugelmir

StevieJ wrote: »

I think margins will fall when interest rates rise, whenever that is.

Agreed. Though there's some way to go before lending rates normalise and the majority of lenders are in the same ball park. At the moment a wide variance even in basic rates. That needs to be worked through the system. As some lenders are scrabbling to raise deposits and others obviously have poorer lending portfolios.

So I would expect at least one major lender to merge with another in the next few years.