US bank stocks trail broader market in May

While the S&P 500 surged 5.3% in May, US bank stocks experienced a mixed market performance.

The market-cap-weighted S&P US BMI Banks index was down 3.0% last month on a total return basis. All 13 of the largest US banks by market cap as of May 29 declined. JPMorgan Chase & Co., Bank of America Corp. and Wells Fargo & Co. dragged down the index, with returns of negative 4.4%, negative 3.5% and negative 5.1%, respectively.

However, the 204 banks in an S&P Global Market Intelligence analysis had a median total return of 1.1% in May. None of the banks recorded a double-digit percentage gain last month. Glenville, New York-based TrustCo Bank Corp NY; Effingham, Illinois-based Midland States Bancorp Inc.; and Bronx, New York-based Ponce Financial Group Inc. led the analysis with returns between 8% and 9%. On the flip side, digital bank Axos Financial Inc. was the weakest market performer with a negative 9.9% return.

The median price-to-adjusted tangible book value (TBV) of the banks included in the analysis was 147.3%, up from 146.1% at April 30 and 140.0% as of Dec. 31, 2025. Just 13 of the banks traded below 100% of their adjusted TBV, while 28 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 62.3% as of May 29, First Internet Bancorp was the least expensive bank in the analysis for the fourth consecutive month. The digital bank had been ranked No. 2 at Jan. 30 and No. 1 for the fourth quarter of 2025.

The next two lowest-valued banks disclosed management changes in May.

No. 2 BCB Bancorp Inc. reported that Michael Shriner is no longer the company's president and CEO or a board member, effective May 20. After speaking with the Bayonne, New Jersey-based bank, Piper Sandler analyst Justin Crowley characterized the exit as "amicable."

No. 3 Eagle Bancorp Inc., based in Bethesda, Maryland, announced the hiring of Stephen Curley as president and CEO, effective July 6. Curley previously worked at Western Alliance Bancorp.

On Dec. 29, 2025, No. 11 Toms River, New Jersey-based OceanFirst Financial Corp. announced the acquisition of No. 4 Uniondale, New York-based Flushing Financial Corp. The deal closed June 2, 2026. In a Form 8-K filing, OceanFirst disclosed that the purchase accounting summary with interest rate marks produced tangible book value (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 is touting the utility of artificial intelligence, had a 6.9% total return in the first five months of 2026; Flushing's year-to-date return through May 29 was 8.3%.

Woodbridge, New Jersey-based Northfield Bancorp Inc., which had the fifth-lowest valuation, announced a sale to Fair Lawn, New Jersey-based Columbia Financial Inc. on Feb. 2. Columbia's second-stage mutual bank conversion offering expires June 16.

Los Angeles-based Hope Bancorp Inc., the No. 7 bank by cheapest valuation, has become one of HoldCo Asset Management LP's top holdings. During the first quarter, the activist investor more than doubled its position in Hope.

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Most expensive banks

Driven by a 5.3% total return in May, Triumph Financial Inc. became the most expensive bank in the analysis. At the end of the month, the Dallas-based bank traded at 390.3% of adjusted TBV. In the first quarter, Triumph led the US banking industry, excluding top-tier companies with assets below $3 billion, certificate of deposits (CDs) less than $500 million or a loans-to-deposits ratio at 25% or below, in the highest sequential decrease in CD concentration.

The Bancorp Inc. and Pathward Financial Inc. each fell one spot in the ranking from the previous month. Among all US banks with assets greater than $5 billion and a loans-to-deposits ratio above 40% as of March 31, Pathward Financial subsidiary Pathward NA had the largest quarter-over-quarter increase in reserves/gross loans ratio.

No. 5 Bank First Corp. is taking advantage of its strong currency through M&A activity. On May 19, the Manitowoc, Wisconsin-based bank announced that it plans to buy Wausau, Wisconsin-based PSB Holdings Inc. Bank First had completed a deal with Beloit, Wisconsin-based Centre 1 Bancorp Inc. on Jan. 1.

With its stout currency and excess capital, No. 6 JPMorgan could pursue a sizable acquisition in the next couple of years.

No. 19 Webster Financial Corp. announced a sale to Banco Santander SA on Feb. 3, but that deal faces some questions. Two US senators are advocating for "careful regulatory scrutiny" of the transaction.