The recent banking woes have put a damper on investors’ confidence. However, financial regulators and banks have assured that the banking system remains strong. Last month, President Joe Biden stated, “Americans can rest assured that our banking system is safe.”
Amid this backdrop, investors could consider adding fundamentally strong bank stocks, The Community Financial Corporation (TCFC – Get Rating) and Hanover Bancorp, Inc. (HNVR – Get Rating), to their portfolios.
Despite the banking crisis, the Commerce Department’s GDP data showed an increase of 5.1% annually in the first quarter. Moreover, the Federal Reserve indicated it could pause its interest rate increases, following its tenth consecutive rate hike of 25 basis points earlier this week.
Adding to the optimistic economic data, many executives from top financial institutions offer multiple assurances that the worst of the banking crisis is over. JPMorgan CEO, Jamie Dimon, stated, “You’ve already seen things calm down quite a bit.” Citigroup CEO, Jane Fraser, said, “Our banking system as a whole is very strong.”
In the wake of the bank failures, banks are likely to face tighter lending standards which might put pressure on their profit margins in the near term. However…
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