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On Thursday, PNC Financial reported a higher fourth-quarter profit due to increased interest payments and reduced capital reserves for potential loan defaults. Wall Street CEOs anticipate a business-friendly approach from the incoming U.S. administration, which is seen as positive for banks. Major U.S. banks like JPMorgan Chase & Co posted strong financial results, while Bank of America saw a rise in interest income.

Banks are expected to benefit from the normalization of deposit costs, which had been high over the past two years due to competition with rate-sensitive products. PNC, based in Pittsburgh, Pennsylvania, saw its net interest income climb to $3.52 billion in the fourth quarter, driven by lower funding costs and asset repricing.

Furthermore, interest rate cuts are anticipated to increase loan demand and deal activity, reduce consumer stress, and allow lenders to decrease reserves for potential defaults. PNC's credit loss provisions dropped to $156 million in the last quarter, reflecting a more positive economic forecast compared to a year earlier.

The bank's net income attributable to diluted common shareholders rose to $1.51 billion, or $3.77 per share, in the three months ending Dec. 31, up from $740 million, or $1.85 per share, in the previous year.