Bank mergers are running at their fastest pace since 2021
A quarterly briefing on US banking, written from what institutions report to their regulators.
Every quarter, more than eight thousand banks and credit unions file detailed reports with the FDIC and the NCUA, and the Federal Reserve, the SEC and FinCEN publish a steady stream of approvals, lists and orders. Almost nobody reads them as they come out. Footnotes does, and tells you what changed: which institutions merged, grew, crossed a line that brings new rules, or drew a regulator's attention, and what each development means for the people who run, supervise, advise and serve them.
Each issue has a trend that is building over several quarters, one set of numbers worth understanding, and a short list of developments, each with what happened, what it means and why it matters. Every figure comes from a public filing.
From January 1 to October 24, 2026, 103 bank mergers closed, according to FDIC records. That is more than double the 46 that closed over the same months of 2024, and above the 93 of 2025. It is the busiest year since 2021.
Bank mergers closed from January 1 to October 24 of each year. Source: FDIC records of bank structure changes.
The longer view puts this in proportion. From 2016 to 2020, between 160 and 225 mergers closed over the same months each year, a steady consolidation that reduced the number of banks year after year. Deals then dried up. The reasons most often cited are the rise in interest rates, which cut the value of bank bond portfolios and made acquisitions harder to price, and longer waits for regulatory approval. 2024 was the low point.
The recovery is real, but this year is still well below the pace of 2016 to 2020.
Deals are also getting larger. The four months to October included Santander's acquisition of Webster Bank, with $85.9 billion in assets, and Prosperity's acquisition of Stellar Bank, with $10.4 billion, according to FDIC records. For every bank, the question is the one boards face in every consolidation wave: whether to buy, to sell, or to compete with banks that are getting bigger.
The numbers
What size does for deposits and costs
One reason for the merger wave is in the Call Reports for June 30, 2026. According to FDIC data, smaller banks grew deposits more slowly than larger ones over the past year, more of them lost deposits outright, and they spend more to earn each dollar of revenue.
Banks by total assets
Banks
Median deposit growth
Deposits fell
Median efficiency ratio
Under $1 billion
3,158
3.9%
24%
63.5%
$1 billion to $10 billion
883
5.1%
18%
59.0%
$10 billion to $100 billion
128
5.8%
16%
55.0%
$100 billion and over
32
5.6%
16%
54.8%
The gap is largest at the bottom. About one in four banks under $1 billion (24%) reported fewer deposits than a year earlier, against about one in six (16%) of banks between $10 billion and $100 billion. Their median efficiency ratio, noninterest expense as a share of revenue, was 63.5%, against 55.0% for the larger group: they spend about 8.5 cents more of every revenue dollar to run the bank.
None of this makes small banks unprofitable. According to the same Call Reports, their median return on assets is 1.21%, against 1.24% for banks between $10 billion and $100 billion, and many community banks outperform larger competitors on both measures. The averages describe the pressure behind many merger decisions: deposits are harder to grow, and the fixed cost of technology, compliance and talent weighs more heavily on a smaller balance sheet.
Santander completed its acquisition of Webster Bank
What happened
Santander Bank, N.A. closed its acquisition of Webster Bank on August 20, 2026, according to FDIC records. Webster reported $85.9 billion in assets on its last Call Report, making this the largest bank merger to close in the past four months by a wide margin.
What it means
Two large customer bases, branch networks and technology estates now sit under one charter. Integrations of this size often run for a year or more after closing.
Why it matters to you
For Webster's commercial and consumer customers, the account changes are still ahead. For banks competing in the Northeast, a large rival's integration year is often a window to win relationships. For anyone who served Webster, the contract decisions are being made now.
13 approved credit union mergers have not converted yet
What happened
According to the NCUA, these mergers were approved in late 2025 and early 2026, and each merging credit union still filed its own Call Report for June 30, 2026. Between them they hold $1.7 billion in member assets.
What it means
The member conversions, onto the continuing credit union's core, cards and digital banking, are still to come. A member vote or a withdrawal can still stop a merger.
Why it matters to you
For the continuing credit unions, this is a busy conversion calendar, and peers that have finished one recently are the best source of lessons. For anyone who serves them, these are projects with dates on them.
14 banks went over $10 billion in assets in the past year
What happened
According to FDIC data as of June 30, 2026, 14 banks reported more than $10 billion in total assets a year after reporting less. 7 of them got there without acquiring another bank. The largest move was Beacon Bank and Trust, which reached $22.2 billion after an acquisition.
What it means
At $10 billion a bank's debit interchange is capped under the Durbin Amendment and the CFPB becomes its supervisor for consumer financial law. Both bring new compliance and reporting work and change the economics of card programs.
Why it matters to you
For banks approaching the line, these peers show what the first year above it looks like. For their advisers and vendors, the year after crossing is when most of the new work is scoped.
473 of 884 mid-sized banks are not on the FedNow list
What happened
Banks with $1 billion to $10 billion in assets have joined the Federal Reserve's instant payment service faster than any other size group, yet 473 of the 884 are not on the Federal Reserve's published participant list as of October 19, 2026.
What it means
Instant payments are becoming an expectation for business customers and for payroll and bill-pay providers. Banks that have not connected are making that choice while their nearest competitors move ahead.
Why it matters to you
If your bank is in this group, it is worth checking which of your peers are live. A bank may also reach FedNow through a correspondent, which the list does not show.
According to FinCEN, it imposed a $1.2 billion civil money penalty on Bank of America, N.A. on October 13, 2026, the largest anti-money-laundering penalty it has announced in the past twelve months.
What it means
Orders like this one set out specific remediation in monitoring, customer due diligence and reporting, on a timeline. They are also a public statement of what the regulator is looking for.
Why it matters to you
For compliance teams elsewhere, the order itself is the most useful part: it describes the failures in detail.
Bank mergers: FDIC records of bank structure changes, mergers effective January 1 to October 24 of each year from 2016 to 2026.
Deposits, efficiency and return on assets: FDIC Call Report data as of June 30, 2026, 4,210 insured banks. Deposit growth compares each bank's deposits with the same quarter a year earlier. Efficiency ratio is noninterest expense as a share of net interest income plus noninterest income.
Credit union mergers: NCUA Merger Activity and Insurance Report, the latest published, and NCUA Call Report data for June 30, 2026.
$10 billion threshold: FDIC Call Report data, total assets as of June 30, 2026 and a year earlier; acquisitions are those the FDIC recorded since July 2025.
FedNow: the Federal Reserve's published participant list as of October 19, 2026, matched to FDIC records by name and location.
Enforcement: FinCEN enforcement actions; amounts as stated in each order.
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Footnotes: Banking is free. Four times a year, after each quarter's Call Reports, with a short update in the months between.
