Overview

The 5,500 commercial banks in the US earn money by lending money at higher interest rates than the interest they pay to depositors. They may also earn money from fees and interest on credit card services, returns on investments in securities, fees for investment services, fees for treasury management services, and other account fees.

Regulatory Compliance Costs

The banking industry is highly regulated and regulations increased significantly following the financial crisis of 2008.

Fintech Competition

Banks are seeing new competition from fintech start-ups, which have received tens of billions of dollars in venture capital funding over the past five years.