Market Analysis · August 27, 2025
Second Quarter 2025 Banking Results: Deposit and Loan Growth
By Tom McDermott, Managing Partner, Inver Consulting Group
Second quarter 2025 banking results are in.
Deposits: growth doubled from Q1
Quarter-over-quarter deposits grew 1.0% in 2Q versus 0.5% during Q1. This was driven by strong performance in the $10B–$250B tier. The two smallest banking tiers continue to struggle, with bigger gaps in their negative deposit growth. Year-over-year overall deposit growth was 3.5%.
Loans: even stronger growth
Quarter-over-quarter loan growth was even stronger at 2.1% in 2Q versus 0.5% during Q1. The largest banking tier, greater than $250B, more than doubled any other tier with 3.9% growth. The two smallest banking tiers also significantly narrowed their negative loan growth. Year-over-year loan growth was 5.1%.
Credit unions and the rate outlook
Credit union results have not been published yet, but they have been consistently higher on deposit growth and similar in loan growth. We will see if these trends continue.
The strong commercial bank results would seem to support the roughly 90% consensus for a rate drop. Chairman Powell's speech in Jackson Hole indicated an "easing bias," signaling a high probability of a mid-September rate cut.