Report: Community banker optimism remains high

Community banker optimism dropped slightly in the fourth quarter but remains high, according to the Conference of State Bank Supervisors.

Details:

• The CSBS Community Bank Sentiment Index dropped one point from last quarter to 132 points but remains well above neutral.

• Community bankers’ continued optimism is driven by solid earnings prospects from wider net interest margins that have boosted profitability.

• The regulatory burden component surged 16 points from last quarter, indicating bankers foresee a lighter regulatory environment in the coming year.

• For the fourth straight quarter, the only component dragging the index lower was expected future business conditions, although this component improved one point from last quarter’s reading.