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1. **Lower regional bank profits:** In the fourth quarter of 2023, some large U.S. regional banks, including Charles Schwab, Citizens Financial, and U.S. Bancorp, saw their profits decline.

2. **Reasons for the decline in earnings:** The decrease in net interest income (NII) was driven by one-time fees and rising costs of maintaining customer deposits. Increasing competition from larger banks for deposits also affected the profits of mid-tier banks.

3. **The earnings growth of specific banks:** Charles Schwab saw a 47% decline in quarterly earnings, Citizens Financial 71%, and US Bancorp 14%. PNC Financial also saw an 8% decline in NII.

4. **Expectations for 2024:** Analysts forecast further declines in earnings per share in 2024 for 11 U.S. regional banks with assets of $50 billion to $100 billion, due to increased deposit costs.

5. **General Economic Context:** The KBW Regional Bank Index declined 1%. Major issues regarding the U.S. economy include concerns about a possible recession, the impact of inflation on the market, and the Federal Reserve's expected interest rate cuts.

How do you think macroeconomic factors will affect the banking sector this year?

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