Forbes’ annual list of America’s Best Banks for 2023 has revealed that small regional banks continue to dominate the top spots, with City Holding Co. taking the top position. Despite the banking industry facing turmoil in 2023, City National Bank, based in West Virginia, remained unaffected thanks to its focus on retail banking and minimal uninsured deposits. The bank’s stock saw an 18% gain in 2023, reflecting its strong financial performance.
City National’s success can be attributed to its commitment to customers in core markets and strategic shift towards profitability rather than growth. While the bank has a high price to book ratio, indicating premium stability, it remains disciplined in its growth through acquisitions. Other top banks on the list include Westamerica Bancorp., International Bancshares Corp., Bank First Corp., and HBT Financial, showcasing the dominance of small banks at the top.
In contrast, JPMorgan is the lone trillion-dollar institution in the top 100, ranking 26th on the list. The bank saw a significant jump in ranking from the previous year, with impressive one-year share price gains and strong financial metrics. JPMorgan’s net interest income reached a record high in 2023, driven by high interest rates and strategic acquisitions like First Republic Bank. The bank’s success highlights its consistent reinvestment in the franchise and strong results over the years.
While JPMorgan’s acquisition of First Republic Bank boosted its performance, other banks like First Citizens Bank also benefited from strategic acquisitions. Despite some banks failing in 2023, the overall industry emerged with a clean bill of health, with most FDIC-insured banks remaining profitable. Large banks like Bank of America, Citigroup, and Wells Fargo, while not making the top 100 list, saw positive returns for shareholders in 2023. The industry’s net income in 2023 showed only a slight decline from the previous year.
Overall, the banking industry continues to show resilience and adaptability in the face of challenges, with small regional banks leading the way in Forbes’ annual rankings. While major banks like JPMorgan stand out for their strong financial performance and strategic acquisitions, the industry as a whole remains profitable and poised for future growth. Investors and customers alike can look to these top-ranking banks for stability and reliability in the ever-changing financial landscape.
