US banks end 2025 on a high note

US bank stocks outpaced the broader market in December 2025 for the second consecutive month.

The 208 banks in an S&P Global Market Intelligence analysis returned 2.9% on a median basis in December 2025, topping the 0.1% gain by the S&P 500 but trailing the 5.2% return of the market-cap weighted S&P US BMI Banks index. Each of the 33 banks with more than $50 billion in total assets as of the most recent quarter experienced a positive total return for the month.

The median price-to-adjusted tangible book value (TBV) of the banks included in the analysis was 140.0% at Dec. 31, 2025, representing an increase of 3 percentage points from Nov. 28, 2025. Only 18 of the 208 banks in the December 2025 analysis traded below their adjusted TBV.

S&P Global Market Intelligence analyzed US banks trading on the Nasdaq, NYSE or NYSE American with total assets of more than $3 billion. The analysis excludes banks in the mutual holding company ownership structure and other operating subsidiaries.

Adjusted tangible book value is calculated as the sum of tangible common equity, loss reserves and unrealized gain or loss from held-to-maturity securities, tax-adjusted at the 21% corporate rate, less nonperforming assets and loans 90 or more days past due but still accruing interest, divided by common shares outstanding.

Least expensive banks

For the third month in a row, First Internet Bancorp was the cheapest bank in the analysis by price-to-adjusted TBV. It ended 2025 priced at 53.2% of adjusted TBV, up from 48.6% at Nov. 28, 2025, but down from 79.4% as of Dec. 31, 2024.

Dallas-based First Foundation Inc., the third-least expensive bank, announced in October 2025 that it had agreed to merge with and into Denver-based FirstSun Capital Bancorp, which ranked 21st on the valuation list at year-end 2025. According to an S-4 filing, the roles were reversed from a few years ago when First Foundation was evaluating an acquisition of FirstSun.

In an investor presentation, FirstSun estimated that the transaction would be 14.3% dilutive to TBV on a GAAP basis, resulting in an earnback period of 3.3 years. On a cash basis, the projection has TBV accretion of 7%. FirstSun also plans to restructure First Foundation's balance sheet.

Another set of companies on the least-expensive bank list — Toms River, New Jersey-based OceanFirst Financial Corp., at No. 15, and Uniondale, New York-based Flushing Financial Corp., at No. 6 — are partnering. OceanFirst announced the acquisition of Flushing on Dec. 29, 2025. In an 8-K filing, OceanFirst disclosed that the purchase accounting summary with interest rate marks showed TBV dilution of 6.4% and an earnback of 3.1 years. The transaction also includes a $225 million investment from Warburg Pincus LLC.

Investors expressed immediate disappointment with the deal. Flushing and OceanFirst were the two worst market performers in the analysis, with monthly returns of negative 6.3% and negative 4.8%, respectively.

On the other hand, No. 16 Midland States Bancorp Inc. was the top market performer, returning 30.2% during December. The banking subsidiary of the Effingham, Illinois-based company sold most of its equipment finance portfolio at the end of November, freeing up capital to pay down high-cost funding.

The 12th-least expensive bank, Topeka, Kansas-based Capitol Federal Financial Inc., announced a special cash dividend of 4 cents per share last month. The company also disclosed that it repurchased 1.6 million shares from Oct. 1 through Dec. 16 last year at an average price per share of $6.72. Capitol Federal's adjusted TBV per share at the end of 2025 was $7.67.

– Read some of the day's top news and insights from S&P Global Market Intelligence. – Set email alerts for future Data Dispatch articles. – Access S&P Global Market Intelligence's calculations for price-to-adjusted tangible book value as of Dec. 31, 2025.

Most expensive banks

The Bancorp Inc. remained the highest-valued bank for the sixth month in a row. Its price-to-adjusted TBV ratio was 436.1% as of year-end 2025, up 22 percentage points from the end of November 2025 and at least 91 percentage points higher than any other bank in the analysis.

Several of the most expensive banks are also among the most shorted within the industry. Among major exchange-traded US banks, The Bancorp ranked fourth for short interest as a proportion of shares outstanding as of Nov. 28, 2025, at 10.7%. Other highly valued banks with more than 6.0% short interest were Dallas-based Triumph Financial Inc.; Everett, Washington-based Coastal Financial Corp.; Honolulu-based Bank of Hawaii Corp.; Louisville, Kentucky-based Stock Yards Bancorp Inc.; Pathward Financial Inc.; and Charleston, West Virginia-based City Holding Co.

Some of the banks on the most-expensive list have adopted contrasting strategies for branching. Fourth-place JPMorgan Chase & Co. and No. 15 San Antonio-based Cullen/Frost Bankers Inc. have reported net branch openings during the last three years, while No. 7 Bank of America Corp. and No. 12 Wells Fargo & Co. have had a significant number of net closures.