Metros, Micros, Rural: Where Do Americans Really Bank?

Many of our clients have asked us recently which markets are best to deploy or redeploy capital. The answer depends on your strategy, but here are insights on the different market types as you start your strategic planning sessions.

The financial landscape is shifting, but the raw numbers tell an incredible story about footprint, legacy, and community penetration. When you look at the total distribution of financial institutions in the United States, how do commercial banks and credit unions actually stack up when broken down by market type?

Metropolitan markets (MSA): credit unions are growing

While commercial banks still hold the majority, major metro areas represent the highest market penetration percentage for credit unions.

• Banks: 59,187 locations (80.8% market share)
• Credit unions: 14,099 locations (19.2% market share)

The insight: metro areas offer dense, highly competitive consumer pools where credit unions have successfully scaled their cooperative banking model.

Micropolitan areas: the middle ground

As we move into secondary hubs and mid-sized economic areas, the balance shifts slightly more toward traditional banking infrastructure.

• Banks: 8,781 locations (84.0% market share)
• Credit unions: 1,671 locations (16.0% market share)

The insight: these markets require significant local commitment, serving as the frontline where community banks and regional credit unions battle for primary financial institution (PFI) status.

Rural markets: bank dominance

In the most remote communities, traditional banks achieve their highest percentage representation, showcasing a legacy advantage in physical footprints.

• Banks: 3,828 locations (88.1% market share)
• Credit unions: 937 locations (11.9% market share)

The insight: banks maintain an overwhelming presence here, but this also highlights a massive vacuum and growth opportunity for rural-focused credit unions looking to expand their membership base.

Source: 2025 FDIC Summary of Deposits and NCUA Call Reports. Markets determined by U.S. Census designation.

The big takeaway for financial executives

Physical footprint strategy is not dead—it has just become highly localized. Banks hold a strong percentage majority across all three segments, but the steady crawl of credit unions in major MSAs demonstrates that consumer appetite for alternatives is alive and well.

As digital transformation standardizes the tech stack, the real battlefield remains community trust and geographic relevance.