SKN | U.S. Bancorp Warns Credit Card Rate Cap Could Weigh Heavily on Consumers and Growth

Key Takeaways

• U.S. Bancorp says a proposed 10% credit card rate cap would negatively affect over 90% of its cardholders.

• Management warned the impact could be severe for roughly half of affected clients and ripple through the broader economy.

• Despite policy uncertainty, U.S. Bancorp delivered a fourth-quarter profit beat.

• Revenue growth expectations for 2026 remain intact, excluding the planned BTIG acquisition.

U.S. Bancorp shares drew renewed attention after CEO Gunjan Kedia issued a stark warning on the potential fallout from President Donald Trump’s proposed 10% cap on credit card interest rates. Speaking to analysts, Kedia said such a cap would have wide-reaching consequences for consumers and economic activity.

According to management estimates, more than 90% of the bank’s credit card customers would experience a negative impact under an across-the-board rate ceiling. Kedia added that for roughly half of affected clients, the consequences would be “crushing,” extending beyond households to the broader economy.

Policy Uncertainty Clouds the Outlook

The comments come as markets await clarity on whether the proposed January 20 deadline for implementing the cap will materialize. Many Wall Street analysts believe the proposal would require congressional approval and faces long odds of passing in its current form.

Industry observers suggest that a negotiated compromise may be the only realistic path forward. Kedia noted that discussions have recently shifted toward more constructive, short-term measures aimed at helping customers manage borrowing costs without imposing a rigid cap.

Credit Card Exposure in Focus

U.S. Bancorp is among the largest credit card issuers in the United States, finishing 2025 with approximately $31 billion in credit card loans. The bank’s portfolio is predominantly prime-focused, which management argues positions it differently from subprime-heavy lenders but does not insulate it from sweeping policy changes.

The bank is also expanding efforts around financial education, with a focus on ensuring customers understand repayment options and tools available to them in a higher-cost borrowing environment.

Earnings Strength Provides Some Cushion

Despite regulatory and political uncertainty, U.S. Bancorp reported a stronger-than-expected fourth quarter. Earnings per share came in at $1.26, topping consensus estimates of $1.19, supported by higher interest income and solid fee growth.

Looking ahead, management expects revenue growth of between 4% and 6% in 2026, excluding the impact of its proposed acquisition of BTIG. This outlook suggests confidence in core operations even as policy risks remain unresolved.

Market Perspective

U.S. Bancorp’s warning highlights how sensitive bank earnings and consumer access to credit have become to policy intervention. While the proposed cap may face significant hurdles, the debate alone has introduced a new layer of uncertainty for lenders and investors alike.

For a confidential discussion on how U.S. consumer credit exposure and regulatory risk can be assessed within a broader financial allocation, contact our senior advisory team.