Major U.S. banks raise prime rates after Fed rate hike

Wed Dec 16, 2015 6:01pm EST
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(Reuters) - Major U.S. banks raised their prime rates, a benchmark for a wide range of consumer and commercial loans, for the first time since 2006 on Wednesday, following a rate hike from the Federal Reserve.

Banks including Wells Fargo & Co (WFC.N: Quote), JPMorgan Chase & Co (JPM.N: Quote) and Bank of America Corp (BAC.N: Quote) raised their prime rates to 3.5 percent from 3.25 percent.

The Fed raised the target for its main short-term rate to a range of 0.25 to 0.50 percent, from a range of 0 to 0.25 percent.

A higher prime rate will translate to higher interest rates on a wide range of loans that are keyed off the rate, including small business loans and some credit card loans.

Lending out at slightly higher rates could give a small boost to bank earnings in the coming quarters.

(Reporting by Dan Wilchins in New York; Editing by Savio D'Souza)

A view of the exterior of the JP Morgan Chase & Co. Corporate headquarters in the Manhattan borough of New York City, May 20, 2015. REUTERS/Mike Segar