As the Democrats look almost certain to take the White House in 2020, PhillipCapital research analyst Yeap Jun Rong warns of a 6-8% drop in profits for US banks. A proposed corporate tax hike from 21% to 28% and possibly greater financial regulation, he argues, could hurt banks already suffering from low interest rates and weakened loan growth. 

“Bloomberg estimates that major US banks’ earnings may fall by 30-40% in FY2020E from the Covid-19 fallout. A further hike in corporate tax rates may hinder their earnings recovery,” Yeap writes in a broker’s report on Oct 19.

See also: Fall in USD 'generally positive' for US energy sector: PhillipCapital

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