Rate hike prospects may stimulate lending now, U.S. Bank CEO says

U.S. Bank officials are welcoming the prospect of an interest rate hike by the Federal Reserve.

The central bank has indicated it may raise a key interest rate mid-year or possibly later. That would boost the cost of borrowing for everything from credit cards to auto loans and mortgages.

U.S. Bank CEO Richard Davis says he expects a big boost in borrowing against lines of credit at current interest rates if business customers think the fed is about to pull the trigger.

"I think there will be a tsunami effect when there's a period where people are sure that rates are moving up. I think they'll start grabbing the lines they have. They'll start using what they have and they'll be incentivized to be a catalyst for this economy."

Davis says the bank is seeing more customers open lines of credit than are taking out loans. He says that's a sign that businesses see opportunities to invest and expand.

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