3Q25 Bank Earnings Credit Risk Deep Dive: Shifting From Stability to Specifics
The 3Q25 earnings season confirmed that U.S. banks are moving from stability to specifics in credit risk management. Asset quality remains resilient, but normalization is accelerating beneath the surface.
Our analysis of earnings of 427 banks and earnings transcripts of 97 regional and community banks highlights rising sponsor reliance in CRE, margin compression in C&I, emerging NDFI exposures, and growing integration of fraud governance within credit oversight. The Great De-Averaging is here — and it’s redefining how risk is rated, managed, and priced.