Regional Banks See Margin Gains as Credit Costs Undershoot Estimates

Nine out of 10 regional banks with $100 billion to $1 trillion in assets reported both sequential and year-over-year net interest margin expansion in the fourth quarter of 2025, according to S&P Global Market Intelligence. Deposit growth was mixed but generally positive, and most of these banks reported earnings above expectations.

Another S&P article found that credit trends were also favorable, with 74% of banks reporting provisions for credit losses below consensus estimates and 67% posting lower-than-expected net charge-offs.