All Eyes On JPMorgan As Big Banks Enter Earnings Season With New Wild Card: Trump’s Credit Card Rate Cap

• U.S. President Donald Trump on Friday said he was considering a one-year 10% cap on credit card interest rates, given the exorbitant rates currently.
• In a Stocktwits poll asking who will be hit the hardest if such a rate cap goes into effect, 27% of users chose big banks, including JP Morgan and Citigroup, over card issuers.
• For the fourth quarter, Wall Street analysts are expecting a total revenue of $46.25 billion and earnings per share of $5.02, according to data compiled by Fiscal AI.

Big banks are set to kick off earnings season this week, and Wall Street is watching for one key issue in particular: how lenders plan to respond to President Donald Trump’s proposed credit card interest-rate cap.

JPMorgan Chase & Co., the first major bank to report earnings on Tuesday, saw its shares close down 1.4% on Monday as investors weighed Trump’s comments from Friday, where he said he is considering a one-year cap of 10% on credit card interest rates, calling current rates of 20%–30% “excessively high.”

While such a move could provide meaningful relief to American consumers who have been grappling with elevated borrowing costs for years, it would likely pressure bank profitability, particularly for institutions that rely heavily on credit card interest income and fee revenue.

Retail traders are already debating the potential fallout. In an ongoing Stocktwits poll asking who would be hit hardest if the cap were implemented:

• 27% said big banks like JPMorgan and Citigroup would take the biggest hit
• 17% pointed to consumer lenders such as Capital One Financial and Synchrony Financial
• 7% voted for payment networks like Visa and Mastercard
• A majority (49%), however, thinks the cap is unlikely to pass, and no group would see a meaningful impact

JPMorgan’s Credit Card Figures

JPMorgan’s third-quarter debit and credit card sales volume were up 9% year-over-year. The company reported that a provision for credit losses was $3.4 billion during that quarter. Net charge-offs were $2.6 billion, up $506 million, predominantly driven by Wholesale and Card Services. The bank said the net reserve build was $810 million, including $608 million in consumer and $205 million in wholesale.

Last week, tech giant Apple and JPMorgan announced that the bank would become the new issuer of Apple Card, with an expected transition in approximately 24 months. Both existing and new Apple customers will get new JPMorgan-issued cards. Goldman Sachs was the previous issuer of the Apple Card.

JPM’s Earnings

For the fourth quarter, Wall Street analysts are expecting a total revenue of $46.25 billion and earnings per share of $5.02, according to data compiled by Fiscal AI. The company is set to report earnings before markets open on Tuesday.

TD Cowen said it expects "solid" fourth-quarter reports for the banks, with continued balance-sheet growth, repricing tailwinds, and a "likely more dovish" Federal Reserve chair in 2026. These "durable tailwinds" should lift bank stocks in 2026, the firm added.

Mizuho Securities on Monday said that the rate cap would likely push banks to tighten lending standards, especially for lower-credit borrowers.

What Is Retail Thinking?

Retail sentiment on JPM jumped to ‘extremely bullish’ from ‘neutral’ a day ago, with message volumes at ‘extremely high’ levels, according to data from Stocktwits.

In the last 24 hours, retail message volumes on Stocktwits about JPM stock jumped 611%.

Shares of JPM have gained over 31% in the last 12 months.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Also See: ABAT Stock Is Already Up Over 50% In January — Retail Traders See A ‘Winning Lottery Ticket’

Share

·

Add us on