Bank Valuations Have Been Driven by Yield Curve, Goldman's Kostin Says

The video discusses the relationship between banks' performance and the 10-year Treasury yield, emphasizing the yield curve's shape as a key valuation driver. It highlights the impact of the US economy's deceleration on financials and the banking system. Despite challenges, positives like bank share repurchases and loan growth are noted. The outlook for 2019 suggests continued yield curve flattening, posing challenges for the financial sector.

What is considered a more important driver of valuation in the financial sector?

• Interest rates set by the Federal Reserve

• Stock market performance

• The shape of the yield curve

• The 10-year Treasury yield

How does the deceleration of the US economy affect financials?

• It challenges the banking system

• It leads to increased bank profits

• It has no impact on financials

• It boosts financial performance

What is one positive aspect mentioned for banks despite economic challenges?

• Increased government regulation

• Rising interest rates

• Bank share repurchases

• Decreasing loan growth

What is the expected trend for the yield curve according to the transcript?

• It will steepen significantly

• It will remain unchanged

• It will continue to flatten

• It will become more volatile

Which type of banks are experiencing closer to 8% loan growth?

• International banks

• Large banks

• Investment banks

• Smaller banks