The White House Is Threatening Card Issuers Again. Time to Buy Bank Stocks?

By Matthew Benjamin – Feb 17, 2026 at 5:15AM ESTKey PointsA top White House economist called on banks to cut credit card rates.Legislation to cap rates is highly unlikely, however.The interest rate outlook for banks is looking better suddenly.These 10 Stocks Could Mint the Next Wave of Millionaires ›Financial stocks are down partly due to Trump's calls for a cap on card interest rates.The Trump Administration is again pressuring credit card issuers to cap the interest rates they charge card holders. "James Dimon, lower your friggin' credit card interest rates," White House trade advisor Peter Navarro said Thursday on Bloomberg Radio. "You are a criminal the way you charge the American people at 22, 25 and 30% and the president wants you to lower that," You might recall that early in January President Donald Trump called for a one-year, 10% cap on credit card interest rates. He said the cap would become effective on Jan. 20, the one-year anniversary of his second inauguration. "Please be informed that we will no longer let the American Public be 'ripped off' by Credit Card Companies that are charging Interest Rates of 20 to 30%, and even more," Trump wrote on X on Jan. 9. Image source: Getty Images. A cap on card rates would require Congress to act No rate cap has been imposed, of course, as that would require legislation. And Congress watchers say that's unlikely. The powerful financial industry has already vowed to fight the proposal with every weapon at its disposal. Legislation to cap credit card rates introduced by Vermont Senator Bernie Sanders early last year stalled in Congress while the financial industry killed a similar effort by the Consumer Financial Protection Bureau to cap late fees on credit card rates. Despite that, Navarro's statements sent share prices of the major card issuers lower last week. Here are the major card issuers and their one-week performance: Bank One-Week Performance Bank of America (BAC +0.06%) Down 8% JPMorgan Chase (JPM 0.06%) Down 6.9% American Express (AXP 1.57%) Down 5.6% Capital One Financial (COF +0.32%) Down 7.5% Citigroup (C 0.26%) Down 9.9% S&P 500 index Down 1% Source: Author's calculations These five stocks are clearly underperforming the broader market, as measured by the S&P 500 index. Also, stocks of the two major card payment networks were also down for the week. Visa (V 3.08%) fell 3.6% and Mastercard (MA 1.73%) is off about 4.7%. The interest rate outlook favors bank stocks now In fact, bank and financial industry stocks should be heading higher right now due to the outlook for interest rates. The futures market was pricing in two quarter-percent rate cuts (0.25%) by the Federal Reserve in 2026 (as of Feb. 13).

The Consumer Price Index data published the Bureau of Labor Statistics last week indicated that inflation continued to moderate in January, even more than expected. As a result, futures markets are now starting to price in a third cut this year. That's good news for banks. When the Fed cuts rates, it pushes short-term rates down more quickly than long-term rates, leading to a steeper yield curve. Simply compare the falling short-term federal funds rate to the 10-year Treasury yield (the longer end of the curve), and you see that the difference between the two rates is widening. This should help banks, because they borrow money from depositors at lower short-term rates and then lend it to consumers and businesses at higher long-term rates. So when the yield curve steepens -- short-term rates fall and longer-term rates remain higher -- bank profits rise. So, a cap on credit card rates doesn't look likely, despite White House demands, while the rate picture for banks is suddenly looking even brighter. And now may be a good time to buy the dip in bank stocks.Read NextFeb 17, 2026 •By Matt DiLalloShould You Invest $500 In AGNC Investment Right Now?Feb 17, 2026 •By Neil PatelBetter Growth Stock: Nu Holdings vs. SoFi TechnologiesFeb 17, 2026 •By Lawrence NgaWhat Robinhood's 2025 Tells Us About Its Next DecadeFeb 16, 2026 •By Thomas Niel3 Magnificent Stocks to Buy That Are Near 52-Week LowsFeb 16, 2026 •By Neil PatelSoFi Technologies Just Proved Bitcoin Has a Clear Use Case for FintechFeb 16, 2026 •By Lawrence NgaRobinhood's 2025: The Year It Became a Real BusinessAbout the AuthorMatthew Benjamin is a contributing Motley Fool stock market and investing analyst covering publicly-traded companies across all sectors. Prior to The Motley Fool, Matt was a senior markets expert at an investing newsletter in Baltimore, an editorial consultant to the World Bank and the International Monetary Fund (IMF), and an economics correspondent at Bloomberg News. He holds a B.A. from Bucknell University and an M.A. from New York University. Fun fact: Matt has met every Federal Reserve Chair from Paul Volcker through Jerome Powell.TMFMbenjamin68Stocks MentionedBank of AmericaNYSE: BAC$52.55 (+0.06%) $+0.03CitigroupNYSE: C$110.86 (0.26%) $0.29JPMorgan ChaseNYSE: JPM$302.46 (0.06%) $0.18MastercardNYSE: MA$518.32 (1.73%) $9.14VisaNYSE: V$314.19 (3.08%) $9.99American ExpressNYSE: AXP$337.50 (1.57%) $5.38Capital One FinancialNYSE: COF$207.56 (+0.32%) $+0.67*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.