By Padraic Halpin and Tim Hepher DUBLIN, Jan 28 (Reuters) - A proposal by U.S. President Donald Trump to cap credit-card interest rates, if implemented, could have a big impact on the profitable loyalty programmes of ​the country's airlines, industry advisers said on Wednesday. Loyalty programmes have become a cash generator for carriers through the ‌sale of miles to third-party partners, mostly credit-card-issuing banks that award the miles to their own customers. The more customers spend, the more m ...

The S&P 500 danced around the breakeven line Friday afternoon while the Dow Jones Industrial Average was down 0.8%, or 382 points, and the Nasdaq Composite was up 0.3%.Among the 11 S&P 500 sectors, financials were the biggest decliner. Shares of Capital One, which is acquiring payments startup Brex for $5.15 billion, were down 7.3%.American Express stock was also down 2.4%. Lending stocks have experienced turbulence since President Donald Trump called for credit-card interest rates to be capped at 10% for o ...

Core Viewpoint - Bank executives are cautiously opposing President Trump's proposal to temporarily cap credit-card interest rates at 10%, while trying to avoid conflict with the White House [1] Group 1 - The banking industry is navigating a delicate balance between opposing the interest rate cap and maintaining a positive relationship with the current administration [1] - Executives are concerned that capping interest rates could impact their profitability and lending practices [1]

Core Viewpoint - Delta Airlines received $2 billion from American Express in the third quarter, indicating strong financial support from credit card partnerships [1] Group 1: Company Performance - Delta Airlines' significant revenue from American Express highlights the importance of credit card partnerships in the airline industry [1] - Airline stocks, including Delta and United, experienced a decline as investors reacted to President Trump's proposal for a 10% cap on credit card interest rates, which could impact revenue streams [1] Group 2: Industry Impact - The proposed cap on credit card interest rates may lead to increased scrutiny on credit card companies and their partnerships with airlines, potentially affecting future revenue models [1] - The overall airline industry is facing volatility as market reactions to regulatory changes could influence stock performance [1]

Group 1 - President Trump demands credit-card lenders to cap interest rates at 10% for one year, threatening legal action if they do not comply by January 20 [1][2] - Major lenders such as JPMorgan Chase, Capital One, and Citigroup are directly affected by this demand, with Barclays shares dropping 4.2% in response [3] - Current credit card interest rates are above 20%, prompting bipartisan legislative interest, though industry resistance is strong due to concerns over profitability and credit access [4] Group 2 - Industry groups, including the Bank Policy Institute and Consumer Bankers Association, express support for affordable credit but warn that a 10% cap could reduce credit availability and harm consumers [5][6]

Core Viewpoint - President Donald Trump is advocating for credit-card companies to impose limits on the interest rates charged to consumers, reflecting a heightened focus on consumer affordability concerns [1] Group 1 - The call for interest rate caps indicates a potential shift in regulatory focus towards consumer protection in the credit card industry [1] - This initiative may impact the profitability and operational strategies of credit-card companies, as they may need to adjust their pricing models to comply with potential regulations [1]

Core Viewpoint - The banking industry is facing pressure from lawmakers and the public regarding high credit card interest rates, with proposals for a cap on rates potentially impacting credit availability for consumers and profitability for banks [3][4][6]. Group 1: Interest Rates and Consumer Impact - The average credit card interest rate was around 21% at the end of the previous year, leading to significant interest costs for consumers carrying balances, such as over $3,500 in interest for a $10,000 balance paid over three years [2]. - A proposed 10% interest rate cap could severely limit credit availability, affecting approximately 14.3 million people and families, particularly those with riskier credit profiles [8]. - Industry groups warn that a cap could lead to reduced credit lines, increased fees, and higher minimum payments for consumers, ultimately pushing them towards more expensive alternatives like payday lenders [4][11]. Group 2: Industry Response and Legislative Context - The banking industry, represented by groups like the Bank Policy Institute and Consumer Bankers Association, has expressed concerns that a 10% cap would be detrimental to credit access for many consumers, despite the intention to help them [3][4]. - Historical attempts to regulate credit card interest rates have faced significant resistance from banks, which have strong lobbying power in Congress [16][17]. - Previous legislative efforts to impose rate caps, such as those proposed by Senator Bernie Sanders and Representative Alexandria Ocasio-Cortez, have stalled, indicating the complexity of enacting such changes [14][15]. Group 3: Financial Performance and Market Reaction - Card lending has become a lucrative business for banks, with JPMorgan reporting a net yield of 9.73% on over $200 billion in card loans, contributing significantly to its revenue [6]. - The KBW Bank Index, which tracks major lenders, has seen a nearly 40% increase since the election victory of President Trump, reflecting positive market sentiment towards the banking sector [13]. - The abrupt demand for a rate cap may create uncertainty for bank shareholders, as it contrasts with the industry's recent profitability trends driven by deregulation [12].