Higher rates lift bank lending profits

The Fed’s inflation fight is helping banks make more from lending, Hope writes.

Catch up quick: JP Morgan, Morgan Stanley, Wells Fargo and Citigroup released second-quarter earnings results this week.

• Each reported a yearly jump in net interest income — the difference between what they charge people to borrow money and what they pay people to deposit money — thanks to higher interest rates set by the Fed.

Why it matters: It's an upside to rate hikes, which have been cooling demand for other banking products and services.

By the numbers: Citigroup's net interest income grew 14% from last year to nearly $12 billion, for example.

• That increase more than offset a roughly $700 million (or 46%) dip in investment banking revenues as corporate clients shied away from financing amid market volatility this year.

What to watch: Bank of America and Goldman Sachs report Monday morning.