Washington Post article by Alejandro Lazo

The Fed has cut the federal funds rate, the key interest rate it controls, six times since September in an attempt to ward off a financial crisis. And with each cut, the rate banks can charge a variety of businesses and consumers has often fallen as well.

Community banks, in particular, are seeing their profits decline because they tend to rely on small-business and real estate development loans that adjust almost immediately to a rate cut by the central bank.

These smaller banks are also more reliant on certificate of deposit accounts, which pay out fixed interest rates to their customers over set time periods, meaning in a time of rapid rate reductions they are locked into paying higher rates until the term expires.

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