US bank stocks trade down in February

The US banking sector underperformed the broader stock market in February.

The 205 banks in an S&P Global Market Intelligence analysis had a median total return of negative 2.1% in February, trailing the S&P 500's negative 0.8% return but outperforming the market-cap-weighted S&P US BMI Banks index, which was down 3.9%. Six of the 205 banks returned negative 10% or worse, led by Everett, Washington-based Coastal Financial Corp. at negative 22.5% and West Reading, Pennsylvania-based Customers Bancorp Inc. at negative 14.7%.

The median price-to-adjusted tangible book value (TBV) of the banks included in the analysis was 139.3% at Feb. 27, down from 144.5% at the end of January and 140.0% as of Dec. 31, 2025. Nineteen of the banks traded below 100% of their adjusted TBV, while 22 were above 200%.

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

With a price-to-adjusted TBV of 54.6% as of Feb. 27, First Internet Bancorp became the cheapest bank in the analysis. The digital bank had been ranked No. 2 at Jan. 30 and No.1 for the fourth quarter of 2025.

BCB Bancorp Inc. fell one spot in the valuation ranking to No. 2. The Bayonne, New Jersey-based bank, which announced a new director last month, finished February trading at 57.8% of adjusted TBV.

Irving, Texas-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 15th on the valuation list as of Feb. 27. According to a Form 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 projected 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 bank modeled TBV accretion of 7%. FirstSun also plans to restructure First Foundation's balance sheet and will seek organic growth opportunities in Texas and Southern California.

Another set of companies on the least-expensive bank list — Toms River, New Jersey-based OceanFirst Financial Corp., at No. 10, and Uniondale, New York-based Flushing Financial Corp., at No. 5 — are partnering. OceanFirst announced the acquisition of Flushing on Dec. 29, 2025. In a Form 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, which is part of OceanFirst's growth pivot, includes a $225 million investment from Warburg Pincus LLC.

Investors expressed immediate disappointment with the deal, but the stocks began recovering in January. OceanFirst, which grew commercial bank loan originations in the fourth quarter of 2025, had a 1.7% total return in the first two months of 2026; Flushing's year-to-date return also was 1.7%.

HoldCo Asset Management LP bought nearly 3 million shares of No. 8 Hope Bancorp Inc. in the fourth quarter. The 2.34% stake in the Los Angeles-based bank was one of just three new positions for the activist investor. Additionally, HoldCo kept its 6.5 million-share position unchanged in No. 12 Topeka, Kansas-based Capitol Federal Financial Inc.

On Feb. 25, Mountlake Terrace, Washington-based FS Bancorp Inc. — ranked No. 16 — announced an acquisition of West Linn, Oregon-based Pacific West Bancorp. The estimates for the stock-and-cash deal include TBV dilution of 2.2% with an earnback of 2.4 years.

– 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 Feb. 27, 2026.

Most expensive banks

Pathward Financial Inc. and The Bancorp Inc. remained the two most expensive banks in the analysis. Their price-to-adjusted TBVs at the end of February were 421.9% and 358.3%, respectively. Pathward eked out a marginal market gain in February, while The Bancorp was the fourth-worst market performer in February with a total return of negative 11.7%.

The 20th-most expensive bank, Webster Financial Corp., was the top market performer with a 10.3% monthly return. On Feb. 3, it announced a sale to Banco Santander SA, representing the third-largest US bank deal since 2010 by announced deal value.

Wells Fargo & Co., the 18th-most expensive bank, had the seventh-lowest return in February at negative 9.6%. Bank executives said that they are focused on organic growth and that any potential US bank acquisition would need to clear a high bar in terms of adding franchise value.

No. 6 JPMorgan Chase & Co. filed an $80 billion shelf registration statement in February. The nation's largest bank by total assets, which is planning to open more than 160 branches this year, ended February priced at 282.7% of adjusted TBV.

No. 9 Honolulu-based Bank of Hawaii Corp. announced a chairman and CEO change, and No. 13 San Antonio-based Cullen/Frost Bankers Inc. announced a share repurchase program of up to $300 million.