After a turbulent summer marked by bankruptcies and market jitters, banks are showing fresh signs of life. According to Trepp, third-quarter earnings reports reveal that loan pipelines are “broadly healthy” and “competition is back,” even as credit quality remains “mixed but largely manageable.”
Trepp Research Director Stephen Buschbom noted that the latest earnings season followed the collapses of subprime auto lender Tricolor Holdings and auto parts maker First Brands—events that raised fears of deeper trouble. JPMorgan Chase CEO Jamie Dimon’s remark that “one cockroach means more are hiding” captured that anxiety. But, as Trepp found in a review of 10 regional and community banks, the filings showed more stability than contagion.
Overall, Trepp’s assessment came down to two themes: banks’ CRE lending pipelines look solid, though at “tighter pricing and conservative structures,” and credit quality remains sound despite isolated pockets of stress.
At First Citizens BancShares, executives cited “increasing competition” as more banks resumed lending. The bank expects CRE office losses to stay “elevated” through 2026. Net charge-offs ticked higher, driven largely by an $82 million hit tied to the First Brands bankruptcy.
East West Bancorp reported healthy pipelines heading into the fourth quarter, with particular strength in granular loans boasting sub-50% loan-to-value ratios. The bank’s nonperforming assets rose slightly to $201 million, just 0.25% of total assets, while its allowance for credit losses increased modestly to 1.42% of loans.
Wintrust Financial projected mid- to high-single-digit loan growth and underscored that banks, unlike many private lenders, are insisting on stronger structures—amortization and covenants included. Nonperforming loans improved to 0.31% of loans from 0.37%.
Western Alliance notched record revenue and balance-sheet growth but disclosed a 74% jump in nonperforming loans quarter-over-quarter because of a single commercial borrower. Loan-loss provisions rose to $120 million from $50 million, though overall portfolio trends were steady.
Old National boosted commercial loan production by 20% to $2.8 billion and ended the quarter with a $4.2 billion pipeline. Net charge-offs totaled $30 million or 0.25% of average loans.
Zions Bancorporation reported 2.1% average loan growth and projected continued low- to mid-single-digit gains led by commercial and industrial activity. The bank booked a $50 million charge-off and $10 million reserve related to two borrowers accused of “apparent irregularities and misrepresentations,” but CRE problem asset levels remained low at about 0.5%.
Cadence Bank logged 3.7% annualized organic loan growth across C&I, energy, specialized and mortgage segments, though offset somewhat by CRE paydowns. Credit metrics were steady, with minimal CRE charge-offs. Valley National Bancorp described similar momentum but with lower net charge-offs—$14.6 million versus $37.8 million last quarter—even as nonaccrual loans rose to 0.86%, largely due to new nonperforming CRE loans.
At Ameris Bancorp, loans grew 4.1% annualized to $216.9 million, with strong demand across C&I and investor CRE categories. Its CRE exposure, at 271% of risk-based capital, remains within internal limits and credit metrics show minimal stress, including nonperforming loans at 0.02% and an average LTV of 57%.
Across the sample, Trepp concluded that while credit quality is uneven, the return of competition—and prudent underwriting—signals measured confidence rather than complacency.
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