NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA) releases this month’s edition of The Bank Treasury Newsletter, by Ethan Heisler, founder and editor-in-chief of The Bank Treasury Newsletter and Senior Director at KBRA.
This month’s issue, Bank Treasurers Talk Over Dinner, reports on the growing bullish outlook among bank treasurers over interest rates and the prospect for rate cuts later this year. Bank treasurers said any restart to the Fed’s rate cuts would lead to banks reducing deposit rates much quicker than when institutions increased deposit rates amid the Fed’s hiking rate cycle in 2018. Further, bank treasurers believe that the shift to interest-bearing from noninterest-bearing deposits in the last year will have a modest negative impact on their net interest income, even though their deposit rates have not budged.
The newsletter also discusses the transition to SOFR from LIBOR at the start of 2022 and observes how SOFR is spiking above the rate for 1-month LIBOR more frequently since the start of the year—a development which will complicate the transition. Finally, the newsletter reviews the latest developments for the transition to CECL, which begins with the new year in 2020.
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KBRA is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider and is a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.