3 Bank Stocks to Buy in July
2026-07-24 16:05
•Patrick Sanders •The Motley Fool
•••••• •••••••••••••••••• Axe Capital view
Bank Stocks to Watch This July
Rising interest rates boost bank profits, creating selective opportunities on the JSE.
South Africa's big banks benefit when interest rates rise because they can charge more for loans while paying less on deposits. Look at Standard Bank and FirstRand: both have improved lending margins and are gaining from the current higher-rate environment. Their recent earnings reflect this nicely, with solid net interest income growth. But be mindful—if the Reserve Bank decides to cut rates to support the economy, that tailwind could fade. Meanwhile, global peers like Bank of America and PNC show how expansion and strong deposit growth fuel profits. Locally, Capitec stands out for its robust credit book and steady customer growth, offering a clean play on retail lending. For those tracking FX, a weakening rand (USD/ZAR rising) could pressure banks with offshore earnings but often benefits exporters. I’d be cautious though, as SA’s credit environment is vulnerable to shocks. this is just my opinion and not financial advice
Buy Standard Bank and Capitec for exposure to higher lending rates and strong customer bases. Trim FirstRand slightly to lock in gains but watch for rate shifts.
- Standard Bank
- Capitec
- FirstRand
- USD/ZAR
- Unexpected interest rate cuts by SARB
- Rand depreciation increasing operational costs
7/10
High interest rates benefit bank stocks by increasing lending spreads and profits. Bank of America reported strong Q2 earnings with double-digit net income growth across all divisions. PNC Financial Services is expanding aggressively with recent acquisitions. SoFi Technologies, down 30% this year, has a compelling growth story and will report Q2 earnings on July 29.
This article was originally published by The Motley Fool and has been adapted here for Axe Capital Trading News.
Publisher: The Motley Fool
Author: Patrick Sanders
Categories: Rates, Equities, Earnings, M&A, Capital Returns, Financials
Tickers: BAC, BACPB, BACPE, BACPK, BACPL, BACPM, BACPN, BACPO, BACPP, BACPQ, BACPS, BMLPG, BMLPH, BMLPJ, BMLPL, MERPK, PNC, SOFI
Sentiment: Positive - Strong Q2 results with 26.4% net income growth, 160,000 new checking accounts, 1 million new credit cards, and 12% increase in wealth management balances. 12.5% total return YTD with 1.8% dividend yield. Solid Q2 earnings showing 21.5% net income growth and 25% EPS growth. Strategic expansion with $4.1 billion FirstBank acquisition adding 100 branches in western U.S. Higher dividend yield of 2.85% compared to Bank of America.
Keywords: bank stocks, interest rates, lending spreads, Q2 earnings, expansion, online banking
Insights:
- BAC: Positive: Strong Q2 results with 26.4% net income growth, 160,000 new checking accounts, 1 million new credit cards, and 12% increase in wealth management balances. 12.5% total return YTD with 1.8% dividend yield.
- BACPB: Positive: Strong Q2 results with 26.4% net income growth, 160,000 new checking accounts, 1 million new credit cards, and 12% increase in wealth management balances. 12.5% total return YTD with 1.8% dividend yield.
- BACPE: Positive: Strong Q2 results with 26.4% net income growth, 160,000 new checking accounts, 1 million new credit cards, and 12% increase in wealth management balances. 12.5% total return YTD with 1.8% dividend yield.