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With rising interest rates, and plenty of cash on hand, banks may be looking to lend

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People walk past the JP Morgan Chase Building on Park Avenue. An influx of deposits during the pandemic have put many banks in position to lend. TIMOTHY A. CLARY/AFP/GettyImages

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This week, we’re getting quarterly results from the country’s big banks. Analysts will be paying close attention to how many loans banks have been making. Bank lending has been pretty slow throughout the pandemic, since many consumers and businesses got the funding they needed through federal relief programs. But banks have some incentives to make more loans this year.

People have been stashing away a lot of cash at banks throughout the pandemic, and banks don’t want that money to just sit around.

“The banks have plenty of deposits to lend, and they will be very eager to do that,” said Gerard Cassidy at RBC Capital Markets.

Especially now that interest rates on loans are rising.

Andrew Davidson at the research company Comperemedia said consumer loan marketing could get a push. 

“Our projection for 2022 is that we’ll see close to 4 billion offers for new credit cards sent to consumers via direct mail, which would be an increase from 2021,” he said.

Banks know consumers aren’t thrilled that interest rates on loans are rising. As a result, Davidson said we’re starting to see credit card offers with “teaser rates.” For instance, “we are seeing more offers now for zero percent, for 18, 21 months. Even 24 months.”

Davidson adds that lenders are likely to push other types of consumer loans, too, including personal loans and products that let consumers pay for things in installments.

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