While sentiment has slipped somewhat, community bankers nationwide remain broadly optimistic about future economic conditions, according to the latest quarterly survey by the Conference of State Bank Supervisors.
The second quarter Community Bank Sentiment Index was 129, down slightly from 131 in the previous quarter and four points below the record high of 133 reached in late 2025, CSBS said. Results above 100 indicate positive sentiment.
The profitability indicator returned to its peak level of 152 in Q2 and continued to signal higher future profitability. Still, the results showed a continued decline in the monetary policy and regulatory burden indicators.
“The results suggest that regulatory conditions might not be easing as much as last quarter’s survey indicated, and bankers have a slightly pessimistic outlook regarding the future impact of monetary policies,” CSBS Chief Economist Tom Siems said.
“Their primary concerns center on the potential negative macroeconomic outcomes that might arise from geopolitical uncertainties due to the ongoing war in Iran,” he added. “Even so, they remain optimistic that for the foreseeable future, their loan portfolios in their local economies will lead to higher profitability.”
