The banking industry reported a return on assets ratio of 1.13% and aggregate net income of $69.9 billion in the second quarter of 2025, a decrease of $677.3 million, or 1%, from the prior quarter, according to the FDIC’s most recent Quarterly Banking Profile released today. Net income for the industry would have increased in Q2 absent an increase in provision expenses related to Capital One’s acquisition of Discover earlier this year.
Quarterly net income for the 3,982 community banks insured by the FDIC totaled $7.6 billion in Q2, an increase of $842.9 million, or 12.5%, from Q1, the agency said. Higher net interest income and noninterest income more than offset increases in noninterest expense and provision expense.
Domestic deposits increased $101.5 billion, or 0.6%, from Q1, rising for a fourth consecutive quarter. Estimated uninsured domestic deposits increased $186.4 billion, or 2.4 %, offsetting a $87.3 billion, 0.8%, decline in insured domestic deposits.
The Deposit Insurance Fund balance increased $4.4 billion to $145.3 billion in Q1. The reserve ratio increased five basis points during the quarter to 1.36%. As of June 30, the reserve ratio exceeded the statutory minimum and, beginning with Q3, the FDIC will no longer operate under the restoration plan.
The total number of FDIC-insured institutions declined by 41 during the second quarter to 4,421. During the quarter, two banks opened, one bank failed, five banks were sold to non-FDIC-insured institutions and 37 institutions merged with other banks.
ABA: Report shows banking industry remains strong
The latest FDIC Quarterly Banking Profile indicates the banking industry remained strong and resilient amid economic uncertainty during Q2, ABA Chief Economist Sayee Srinivasan said.
“Asset quality remained sound, domestic deposits increased and quarterly loan growth was the strongest we’ve seen since the second quarter of 2022 as banks responded to the funding needs of their customers and communities,” Srinivasan said. “The QBP shows America’s banks, with their strong capital and liquidity levels, are poised to continue driving our nation’s economy forward.
“Significantly, the Deposit Insurance Fund reserve ratio increased to 1.36%, surpassing the statutory minimum requirement three years ahead of schedule, which provides an opportunity to revisit assessments and the outlook for the fund,” he added. “ABA looks forward to participating in that conversation alongside our members.”
