Rate Relief Uncertain as Loan and Deposit Growth Accelerate

Deposit betas climbed to 31.17% in late 2025 as rate cuts lowered funding costs, but expectations for fewer additional cuts limit further relief while loan yields hold steady, S&P Global Market Intelligence wrote. The combination of a more stable rate environment and higher long-term yields is leading to a positive earnings outlook driven more by asset sensitivity than declines in deposit costs.

Another S&P article discussed the 6.6% year-over-year increase in loan growth and 5.6% increase in deposit growth as of April 1, 2026, though sustained geopolitical and energy price pressures could weaken borrower demand and reduce the likelihood that existing loan pipelines convert into funded balances.