One Thing Still Working: Borrow Low, Lend Higher

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BY VALERIE BAUERLEIN

It's hard to believe, but not all the news in banking is bad. As market fears continue to swirl over whether the government will nationalize some large U.S. institutions, others are starting to see the benefit of a return to old-fashioned, bread-and-butter banking.

Several of the nation's biggest regional banks have reported recent upticks in net interest margin, one of the most fundamental drivers of bank profits, as dirt-cheap funding and choosier loan policies are making it easier for them to borrow money at a low rate, lend it at a higher rate, and pocket the difference.

U.S. Bancorp's net ...

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