Fed’s Duke: Consumer shields to dent bank profits

HOLLYWOOD, Fla., June 8 (BestGrowthStock) – New rules aimed at
protecting consumers from taking loans that land them in
financial trouble are necessary to restore consumer confidence
but will cut into a source of bank profitability, Federal
Reserve Governor Elizabeth Duke said on Tuesday.

“While the additional protections for consumers are long
overdue, they will require considerable changes in bankers’
business practices and product pricing and design,” Duke said
in comments prepared for delivery to a banking conference in
Hollywood, Florida.

“The changes reduce the ability to build profitability
models around penalty pricing such as overdraft fees or raising
rates on existing credit card balances,” she said.

Duke did not discuss the outlook for monetary policy or the
economy in her remarks.

Stock Market Basics
(Reporting by Michael Connor, writing by Mark Felsenthal;
Editing by Leslie Adler)

Fed’s Duke: Consumer shields to dent bank profits