Head of North American Investment Strategy & Research
Insight of the Week
The regional bank scare back in March of 2023 was one of the fallouts of the Federal Reserve’s aggressive rate hiking schedule that took the policy rate from .25% all the way up to 5.5% over an 18 month period.
As seen in the chart included in the below, prior to this event, the smaller regional banks and the larger diversified banks had tracked each other well.
However, the event clearly impacted the regional banks much more, and the gap between these two remains wide and has yet to converge.