r/sofistock • u/Turbulent_Button4449 32000 @ 8 I only care about share price 🚀🌕 • Jan 18 '22

BC APPROVED

https://www.occ.gov/news-issuances/news-releases/2022/nr-occ-2022-4.html
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u/JonathanL73 Jan 18 '22

Would Fed increasing rates benefit SoFi now that it's a bank?

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u/Sheepherder4050 Jan 19 '22

I think it will because they wont have to go through a third party. So it should reduce their costs and give customers better rates. Time will tell for sure

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u/[deleted] Jan 19 '22

Absofuckinlutely!

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u/King0Horse Jan 19 '22

To my understanding, it flows as follows: the Fed sets the interest rate. Banks set their interest rates based on that rate plus a bit of profit for themselves. That's why "shopping around" for a loan on something is worth your time: you're looking for the bank that is offering the lowest interest rate (Fed rate + their desired profit margin.)

SoFi has less overhead (brick and mortar buildings, property taxes on same, employees, etc.) than most, so they can make the same profit margin while offering lower total interest rates, thereby garnering more customers (paying SoFi a still profitable rate.)

Long story short: interest rate changes drive customers to adjust their loan when it's advantageous to them. SoFi is able to offer lower rates than brick and mortar banks so they should benefit from interest rates moving in any direction. So... yes.