Banks: Q4 2025 Earnings Season Themes

Economic Trends:

Investors and analysts will be interested in hearing about the economic trends that banks are seeing in their particular markets, now that they have had more time to see how the tariffs are impacting loan demand, consumer spending, and asset quality. The interest will be higher for banks whose markets have a significant amount of manufacturing and agricultural activity where tariffs are having a greater impact.

Loan Growth:

Industry data has indicated that there is modest loan growth occurring in the fourth quarter with some banks indicating during the quarter that they are seeing an increase in CRE loan demand. Along with loan growth in the fourth quarter, investors and analysts will be interested in hearing how loan pipelines are trending and how that is impacting expectations for the level of loan growth in 2026, and which areas of lending are expected to drive most of the loan growth.

Deposit Growth and Pricing Trends:

Many banks were able to successfully reduce deposit costs in the third quarter, so there will be interest in seeing if they have continued to reduce rates and to what extent that has impacted deposit flows and deposit growth. There will be interest in hearing about the competitive environment in markets and if some banks are still being aggressive in pricing to win deposits. Industry data has indicated that there has been deposit growth during the fourth quarter, although it appears to be mostly in higher interest-bearing accounts. 

NIM Trends:

Many banks saw expansion in their net interest margins in the third quarter due to a combination of being able to reduce deposit costs and new loans coming on the books at higher rates than the loans that paid off. There will be interest in seeing if that trend continued in the fourth quarter, as well as how banks are expecting their net interest margin to trend going forward with the Fed continuing to cut rates.

Credit Quality:

During the third quarter, broadly there were negative trends in asset quality, particularly in categories such as multifamily, construction, and commercial loans, although these trends were more pronounced in certain geographic markets than others. Trends in CRE, HELOC, and other loans were positive. There will be interest in hearing if these trends continued in the fourth quarter, as well as if banks are seeing more impact from clients filing for bankruptcy.

Capital Utilization:

Investors will be interested in getting an update on priorities for capital utilization, including if M&A and stock buybacks are becoming a greater possibility. M&A activity has picked up in the banking sector in recent months, so investors and analysts will be interested in hearing if other banks are now looking to make acquisitions.

Updated Outlook for 2026:

Investors and analysts will be interested in hearing the guidance that banks provide for expected loan and deposit growth, NIM trends, fee income, expenses, and asset quality in 2026. In particular, investors and analysts will be interested in hearing banks’ priorities for investments in 2026 between adding new bankers or technology. In addition, for banks in markets where M&A transactions are occurring, investors and analysts will be interested in hearing if they believe they will have opportunities to capitalize on the disruption caused by the M&A to add new customers and banking talent.

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