Bank of America has released a ranked list of U.S. mid-cap banking stocks that it views as positioned to deliver relative outperformance. The firm points to an industry backdrop where margin expansion, loan growth and more visible capital-return prospects are the primary catalysts across the names highlighted.
The compilation features institutions pursuing different growth strategies - from relationship-driven commercial lending and deposit initiatives to fee income platforms and strategic regional expansion. Below are the nine banks BofA placed on its mid-cap list, together with the firm-specific factors it flagged.
1. Associated Banc-Corp (ASB) - BofA ranks Associated Banc-Corp as its top pick among mid-cap banks. The bank is expected to accelerate relationship-driven commercial lending, with new hires contributing roughly half of the anticipated loan growth. Management initiatives aimed at deposits combined with modest asset sensitivity are expected to underpin margin expansion. The firm notes that capital accumulation could support share buybacks later in 2026.
Associated Banc-Corp has secured all required regulatory approvals to complete its merger with American National Corporation and has announced a new $100 million share repurchase program.
2. Cullen/Frost Bankers (CFR) - Cullen/Frost is described as a high-quality franchise benefiting from clean credit metrics and potential upside if rate cuts are fewer than expected. BofA highlights strong market share gains and optionality from capital markets activities as factors supporting earnings resilience.
The bank reported fourth-quarter 2025 earnings per share of $2.56 on revenue of $603.38 million, both results surpassing analyst expectations. Following the results, TD Cowen and DA Davidson raised their price targets on the company.
3. East West Bancorp (EWBC) - BofA sees a loan growth outlook for East West in the 5-7% range, supported by robust commercial pipelines. The bank’s balance sheet positioning and limited credit risk are cited as strengths, while the firm cautions that fee income volatility remains a factor to monitor.
East West reported fourth-quarter operating earnings per share of $2.52, slightly above analyst expectations. Its pre-provision net revenue for the quarter was $490.2 million.
4. First BanCorp (FBP) - The analyst team expects continued margin improvement at First BanCorp driven by deposit repricing and securities rollover. Loan growth is forecast at mid-single digits and skewed toward the second half of the year, with credit trends characterized as stable.
First BanCorp reported fourth-quarter 2025 earnings per share of $0.55 on revenue of $257.17 million, results that surpassed analyst forecasts. The company also announced that its Chief Financial Officer, Orlando Berges, will retire in June 2026.
5. FNB Corporation (FNB) - FNB is framed as a back-half growth story where commercial momentum is improving. Net interest margin expansion is expected to be gradual but consistent, driven by reinvestment and deposit repricing.
Moody's recently affirmed FNB Corporation’s Baa2 long-term issuer rating and revised its outlook to stable from negative.
6. Popular Inc (BPOP) - Popular is noted for strong capital levels and an anticipated steady margin expansion trajectory. The bank’s exposure to Puerto Rico is viewed as a supportive macro backdrop, though BofA flags higher oil prices as a longer-term risk to monitor.
Popular reported fourth-quarter 2025 earnings per share of $3.53, significantly surpassing analyst forecasts. BofA Securities upgraded the company to Buy from Neutral.
7. Texas Capital Bancshares (TCBI) - Fee income and a capital markets platform are highlighted as key differentiators for Texas Capital. Management has described borrower sentiment as constructive, but the analyst note observes that geopolitical risks could delay deal activity and therefore affect the capital markets pipeline.
S&P Global Ratings revised its outlook for Texas Capital Bancshares to positive from stable, citing progress in the bank’s strategic plan. After a strong quarter, DA Davidson, Stephens and RBC Capital each raised price targets on the company.
8. UMB Financial (UMBF) - UMB Financial is seen as maintaining a high-single-digit loan growth trajectory, underpinned by strong organic production and acquisition-driven expansion. The firm highlights fee income and operating leverage as primary earnings drivers for the bank.
UMB Financial reported fourth-quarter 2025 earnings per share of $3.08 and revenue of $720.9 million, both figures exceeding analyst forecasts.
9. Zions Bancorporation (ZION) - BofA points to deposit repricing and securities reinvestment as durable engines for margin expansion at Zions. The bank’s improving earnings visibility is expected to support increasing capital return over time.
The ranked list emphasizes a combination of lending momentum, funding initiatives and capital flexibility as the main themes underpinning BofA’s mid-cap selections. While the institutions vary in franchise model and regional exposure, the common threads are improved net interest margin prospects, the potential for loan growth and clearer pathways to deploying capital to benefit shareholders.
Summary: Bank of America identified nine mid-cap banks it views as likely to outpace peers, driven primarily by margin improvement, loan growth and stronger capital-return prospects. The roster includes banks focused on commercial relationship lending, fee-based income and strategic market-share expansion.
Key points:
- Margin expansion, loan growth and capital return prospects are the primary drivers behind BofA’s mid-cap rankings.
- The list includes franchises with distinct strategies: relationship-driven commercial lending, fee-income platforms and regional market share gains.
- Sectors directly affected include regional banking and commercial lending, with implications for capital markets activity tied to fee income and deal pipelines.
Risks and uncertainties:
- Fee income volatility remains a concern for banks such as East West Bancorp, which could affect earnings stability - impacting capital markets and wealth-management-related revenue streams.
- Geopolitical risks could delay deal activity for institutions with capital markets exposure, such as Texas Capital Bancshares, creating uncertainty around fee generation from transactional businesses.
- Higher oil prices are noted as a longer-term risk for Popular Inc, which could affect regional economic conditions that influence loan performance and provisioning assumptions.
For readers seeking additional context on specific companies, the report provides recent quarterly results and notable corporate actions that underline BofA’s conviction in each name. The bank’s rankings reflect a view that selective mid-cap lenders can benefit from improving net interest margins, loan growth momentum and more visible capital deployment options.