Regional banks down as Trump's tariffs trigger recession fears

Shares of U.S. regional banks down after President Trump slapped reciprocal tariffs on major geographies, sparking recession fears among investors

Some regional banks like Fifth Third Bancorp FITB.O, M&T Bank MTB.N, Keycorp KEY.N and Comerica CMA.N fell, with Western Alliance WAL.N leading the declines with a nearly 9% fall

The sweeping new tariffs will raise effective import taxes in the world's largest economy to the highest levels in a century, which is expected to trigger recession, affecting banks' lending business as consumers will cut their spending

The recession fears will also prompt Federal Reserve to slash interest rates which will eat up into banks' net interest income, a key profit metric for the lenders

KBW Regional Banking Index .KRX tumbles 7.7%