US President Donald Trump stated that it would be illegal for credit card issuers if they refuse to comply with his demand to cap credit card interest rates at 10% for one year. Following these remarks, the share prices of several US banks heavily reliant on credit card operations experienced a downturn.

The comments intensify political pressure on a range of card issuers, including Barclays, JPMorgan Chase, Capital One Financial, and Citigroup. In recent years, credit card rates have consistently hovered above 20%, making them a common target for criticism from lawmakers across both US political parties. While related legislative proposals have been repeatedly introduced, they have faced strong resistance from the banking industry.

During early Monday trading on the London Stock Exchange, Barclays' share price plummeted by as much as 4.8%, marking its largest intraday decline since October 17th.

In pre-market trading in New York, Capital One Financial's stock tumbled 10%, while American Express fell 4.9%. Other major US bank stocks also declined, with Citigroup down 4.3%, JPMorgan Chase down 3%, and Wells Fargo down 2.4%.

Credit card operations form the core of Barclays' US personal banking business, encompassing co-branded cards, small business credit cards, and proprietary branded cards. Barclays US Personal Banking currently serves approximately 20 million American consumers and has been actively expanding its US credit card market presence in recent years. This expansion includes acquiring General Motors' co-branded card portfolio and securing the Gap Inc. credit card business from Synchrony Financial.

Bloomberg Intelligence Perspective Among all European banks, Barclays would be the most severely impacted if the US implements a credit card interest rate cap or restrictive policies. It is projected that in 2025, Barclays US Personal Banking will generate £3.6 billion in revenue, accounting for 12% of the group's total revenue and contributing 5% of pre-tax profit, with credit card business being the core pillar of this segment. However, considering the powerful lobbying strength of the US banking industry, Trump's proposed 10% credit card rate cap is highly unlikely to be fully enforced. — Phil Richards

While returning to Washington from Florida on Air Force One on Sunday, Trump reiterated his policy stance to accompanying journalists. He demanded that card issuers reduce credit card interest rates to 10%, maintain that level for one year, and set January 20th as the final compliance deadline.

Trump stated, "If the rates are not capped by then, these institutions will be breaking the law. Some institutions have credit card rates as high as 28%, even approaching 30%. People going about their daily work and lives have no idea they are paying such exorbitant rates."

A Barclays spokesperson declined to comment on the matter.