Improved efficiency, wider net interest margins and stronger loan and deposit growth helped make 2025 a favorable year for community banks with $2 billion to $10 billion in assets.
The 20 top-performing banks in this asset tier posted an average net interest margin of 3.57%, reflecting stronger profitability in their core lending businesses. Many also generated solid growth on both sides of the balance sheet, demonstrating broad-based strength across the group.
Capital Performance Group analyzed the data for American Banker using information from S&P Global Market Intelligence. CPG Principal Ally Akins noted that banks were able to grow loans and deposits faster than they had in 2024 while also improving margins and profitability.
The highest-performing institutions further distinguished themselves by developing successful lending specialties in sectors such as agriculture, energy and hospitality. These clearly defined niches can provide a meaningful competitive advantage by helping banks build expertise, differentiate themselves and compete more effectively within their markets.
Banks also continued to invest in growth. Although noninterest expenses increased, much of that spending supported technology and marketing capabilities designed to improve digital targeting and help community banks compete with larger institutions and fintech brands.
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