Deposit flight is one of those phrases that gets overused fast. It sounds dramatic, and sometimes it should. But in most reporting periods, the real story is not a system-wide run. It is a slower, more competitive fight for funding. Banks raise rates, lean harder on brokered deposits, protect key customer relationships, and try to keep loan growth and liquidity plans aligned with a funding base that is more price-sensitive than it used to be.
That is the right way to think about the U.S. banking funding story in 2026. This article is a 2026 interpretation of the latest local U.S. Call Report snapshot currently available in the database, dated 2025-12-31. It is not a claim that 2026 Call Report data is already available. The point is to use the last full-year 2025 bank data to understand where deposit pressure may matter most as 2026 unfolds.
Public data shows a system that is still competing actively for deposits, but not in a uniform way. Some banks are still growing deposits comfortably. Others are paying up, relying more on brokered funding, or showing outright year-over-year declines. The useful question is not whether deposits are leaving everywhere. It is which banks are defending funding cheaply, which are buying it, and which are using more tactical sources to keep the balance sheet in place.
Methodology
The bank-level figures below come from local calculations using public Call Report and FDIC institution data for the quarter ended 2025-12-31.[1][2] In this article, active U.S. banks means FDIC-insured commercial banks and savings institutions in the local extract that were open or reporting for that quarter and had positive total deposits. Usable deposit data means the institution had the fields needed for the relevant calculation; the deposit-growth count also requires a comparable prior-year deposit value.
The averages are simple institution-level averages, not asset-weighted industry averages. That choice is intentional: it shows what the typical bank in the screen looks like, not what the largest balance sheets dominate. The cost-of-deposits proxy is annual deposit interest expense divided by period-end total deposits. Deposit beta is a rough rate-level screen: that cost proxy divided by the effective federal funds rate on the same date, not a formal through-cycle beta model.[3]
Key Takeaways
- The funding data referenced here is dated 2025-12-31. No fresher Call Report date is implied.
- Across 4,301 active U.S. banks with usable deposit data, the simple average brokered deposit ratio was 4.07%, while the median was 0%.
- The simple average cost of deposits was 2.29%, and the median was 2.00%.
- The simple average year-over-year deposit growth rate was 9.59%, while the median was 4.09%.
- 576 banks had brokered deposits above 10% of total deposits, and 954 banks posted year-over-year deposit declines.
- The main 2026 funding story is not simply “deposits are leaving.” It is that banks are competing for funding in very different ways, and some models are paying much more for it than others.
What “Deposit Flight” Really Means in 2026
When people say deposit flight, they often mean one of three different things. First, they may mean a true deposit outflow problem, where balances leave the bank and do not come back. Second, they may mean a pricing problem, where deposits remain but become materially more expensive. Third, they may mean a composition problem, where stable core deposits give way to more rate-sensitive or brokered funding.
Public bank data shows all three can happen, but not evenly. The phrase also carries baggage from the 2023 stress period, when uninsured-deposit concentration and unrealized losses became part of the same funding conversation.[5][6] That is why it is better to talk about funding competition than deposit flight in the abstract. A bank can retain deposits and still be under pressure if it has to pay much more to keep them. Another bank can grow deposits rapidly, but only by leaning heavily on brokered channels. Another can show declining deposits while still looking manageable if liquidity and capital remain solid.
In other words, the useful question is not just “are deposits up or down?” The useful question is “what kind of funding is this bank getting, and what is it costing?”
The Three Public Signals That Matter Most
1. Deposit growth or decline
The simplest signal is whether deposits are rising or falling. In the quarter-end snapshot, 954 active U.S. banks showed year-over-year deposit declines. That does not mean all of them are under meaningful stress. Some banks intentionally shrink deposits because of balance-sheet strategy, acquisition effects, or pricing choices. But a decline is still worth attention because it can force other changes elsewhere on the balance sheet.
The median bank still showed positive deposit growth of 4.09%, which is an important reminder that the industry-wide story is not a universal outflow event.[4] It is a mixed picture.
2. Brokered deposit reliance
Brokered deposits are not automatically bad, but they are usually more sensitive and more tactical than core relationship funding. In the same data, the average brokered deposit ratio was 4.07%, but the median was 0%. That tells you the system is highly uneven. Many banks use little or no brokered funding, while a meaningful subset depends on it heavily.
There were 576 banks with brokered deposits above 10% of total deposits. That is where funding pressure starts to matter more operationally. If a bank has to use brokered funding to maintain growth or defend liquidity, the economics and risk posture change.
3. Cost of deposits
This is the most underrated public signal. A bank may report stable deposits, but if the cost of those deposits is climbing fast, competition is still biting. Using interest expense on deposits relative to total deposits as a simple public proxy, the average cost of deposits was 2.29% and the median was 2.00%.
That is the practical sign of a more contested funding market. Even when balances hold, the price of holding them can rise meaningfully.
The deposit-beta framework: distribution tells you where stress sits
A simple beta screen makes the cost signal easier to compare. A 2.29% average cost-of-deposits proxy measured against a 3.64% effective federal funds rate on 2025-12-31 implies a simple system-wide beta of roughly 63%.[3] That number should not be overread. It is a sorting tool, not a clean measure of how much every bank repriced through the full cycle.
The average, though, is still the wrong summary statistic. The more useful question is the distribution of beta across the industry, because that is where 2026 margin risk actually sits. Three broad cohorts show up once you plot beta rather than level:
- Low-beta franchises (0-35%) – primarily community and retail-heavy banks with sticky non-interest-bearing demand deposits and long relationship tenure. Average cost of deposits is typically below 1.8%. These banks already realized much of the margin benefit on the way up and may be slower to reprice down.
- Mid-beta regional mix (35-65%) – the broad middle of the industry, where cost of deposits typically runs 2.0-2.9%. Many large regionals sit here. Margin outcomes are more balanced: some give-up on the way up, some benefit if funding costs fall.
- High-beta exposure (65%+) – banks with cost of deposits above 3.5%. This cohort can include online-primary retail banks, brokered-heavy institutions, BaaS or fintech-sponsor banks whose depositors are professional rate shoppers, and specialty lenders matched-funded against high-yield assets. A small number of names run beta at or above 100% because their funding mix tilted toward brokered and high-yield savings during the peak-rate period.
The right tail, especially banks currently running cost of deposits above 70% beta, is where funding-cost pressure deserves closer review in 2026. If policy rates fall, these deposits may not reprice down at the same speed they repriced up, because rate-sensitive customers can move rather than accept faster cuts. That asymmetry is the reason beta is useful as a forward-looking screen. It still needs peer context, asset-yield context, and business-model context before it becomes a stress conclusion.
Important specialty caveat: the most expensive funding profiles in the data, including Beal Bank USA, Monet Bank, and John Deere Financial FSB, all show cost-of-deposits proxies above 13%. These are not automatically distressed high-beta outcomes. They reflect matched-funded specialty business models. High funding cost may be paired with high asset yield, so net interest margin can remain healthy. Always separate specialty-bank matched funding from community or regional funding stress before drawing conclusions from the cost-of-deposits tail. The tail of interest for 2026 stress is not simply the specialty 13%+ names; it is the conventional lenders with high beta, weaker spread protection, and fewer obvious business-model reasons for expensive funding.
What the Outliers Show
Public data is most useful when you look at the edges, not just the averages. But outliers should be read as classification questions first, not distress calls. Before reacting to a 99% brokered ratio or a 13% deposit-cost proxy, ask what kind of institution it is: a traditional community bank, a card bank, a captive finance bank, a fintech sponsor bank, a specialty lender, or a deliberately brokered-funded model. Then compare the funding profile with asset yield, liquidity, capital, and credit quality.
On the brokered funding side, several banks were funded overwhelmingly by brokered deposits in the snapshot. Hatch Bank in California showed a brokered ratio of about 99.8%. Eaglemark Savings Bank in Nevada was about 99.5%. Comenity Bank in Delaware was about 98.9%. Medallion Bank in Utah was about 98.7%. Those are not “normal local core deposit franchise” profiles. They are specialized funding models, and they need to be understood that way.
On the deposit cost side, the most expensive funding profiles were even more striking. Monet Bank in Texas and Beal Bank USA in Nevada both showed cost-of-deposit proxies above 13%. John Deere Financial, F.S.B. in Wisconsin was also above 13%. Comenity Bank was above 8%. Those numbers do not automatically mean distress. Some reflect business model, product mix, or specialty franchise structure. But they do show how aggressively some institutions are paying for funds.
That is the key funding lesson for 2026: one bank’s deposit base is not another bank’s deposit base. The headline deposit number is only the start.
How to Read Funding Pressure Without Overreacting
Funding pressure works its way through a bank in several ways. It can compress margins. It can force a bank to rely more on wholesale or brokered channels. It can slow growth because management becomes less willing to add assets without stable deposits to support them. And if pressure intensifies, it can start to interact with unrealized securities losses, credit concerns, or capital planning.
That is why funding is rarely a standalone story. It is a balance-sheet amplifier. A bank with strong liquidity, steady core deposits, and conservative credit may be able to absorb deposit competition without much visible damage. A bank with a concentrated loan book, thin margin, or high dependence on rate-sensitive funding may feel the same environment much more acutely.
If you are screening a bank right now, there are five practical questions to ask. Is deposit growth real, weak, or being bought? How much of the funding base is core versus tactical? What is happening to deposit cost? What else is happening on the balance sheet? And does an outlier metric reflect a specialty model, or does it look unusual even against the right peer group?
Those questions also help avoid the common interpretation mistakes. A year-over-year deposit decline is not proof of flight. Brokered deposits are not inherently dangerous. A high cost of deposits may be normal for a specialty lender and alarming for a conventional commercial bank. A 3% cost of deposits might look high in one peer set and ordinary in another. Context is the difference between noise and insight.
How Banking Intelligence Fits the Funding Workflow
Most people do not need more raw Call Report lines. They need a way to move from a bank name to an informed view of its funding posture quickly. Banking Intelligence fits that workflow by organizing public bank data into searchable profiles, signals, and context.
Use bank pages to identify the institution and basic profile. Use early warnings to spot funding-related flags. Use the live funding-analysis view to understand what the local U.S. coverage includes and how current it is. That is a much faster path than manually piecing together one-off filings every time a funding question comes up.
The phrase “deposit flight in 2026” captures the anxiety, but the public-data story is more nuanced. At the latest available quarter-end, U.S. banks were not moving in one direction. Many were still growing deposits. Many still had no brokered funding at all. But a meaningful group was clearly paying more for deposits, relying more on brokered channels, or managing outright declines.
That is what competing for funding in 2026 really looks like: not one system-wide outcome, but a wide spread of funding models under pressure in different ways. The banks that matter most are the ones where funding pressure starts to reinforce other balance-sheet weaknesses. That is where public data becomes genuinely useful.
FAQ
Is this 2026 bank data or 2025 Call Report data?
It is a 2026 interpretation based on the latest local U.S. Call Report snapshot available in the database, dated 2025-12-31. The article uses that quarter-end data to frame funding competition going into 2026.
What does deposit beta mean for a bank?
Here it means a rough rate-level screen: the bank’s cost-of-deposits proxy divided by the effective federal funds rate. It is useful for sorting banks by funding sensitivity, but it is not a complete through-cycle repricing model.
Are brokered deposits a sign a bank is unsafe?
No. Brokered deposits can be a normal part of a funding strategy, especially for specialized institutions. The risk question is whether the bank depends on them in a way that leaves margins, liquidity, or growth plans vulnerable if pricing or availability changes.
Why can a bank have high deposit costs without being distressed?
Some specialty banks intentionally pay high funding costs because they also hold higher-yielding assets. That can be a coherent matched-funded model. The same cost level at a conventional lender with weaker asset yields would deserve a different reading.
How can I compare deposit pressure between two banks?
Start with deposit growth, brokered deposits as a share of total deposits, and cost of deposits. Then compare each bank with its peer set, asset mix, liquidity, capital, and credit quality. The combination matters more than any single metric.
What would change the 2026 funding read?
The next useful signal would be whether deposit costs fall, stay sticky, or keep rising in later Call Reports. If high-beta banks keep paying up while deposit growth slows and credit metrics weaken, the funding concern becomes more serious.
Sources
- FFIEC Central Data Repository, Call Report bulk data and Reports of Condition and Income used as the bank-level source for deposits, brokered deposits, and deposit interest expense: https://cdr.ffiec.gov/public/PWS/DownloadBulkData.aspx
- FDIC BankFind Suite API documentation and institution data used for bank status and FDIC-insured institution context: https://api.fdic.gov/banks/docs
- Federal Reserve Bank of St. Louis FRED, Federal Funds Effective Rate (DFF), used for the effective fed funds denominator in the deposit-beta screen: https://fred.stlouisfed.org/series/DFF
- FDIC Quarterly Banking Profile, Q4 2025, used for industry-level context on deposits, earnings, capital, liquidity, and asset quality: https://www.fdic.gov/quarterly-banking-profile/quarterly-banking-profile-q4-2025
- FDIC, Options for Deposit Insurance Reform, used for deposit stability and uninsured-deposit context: https://www.fdic.gov/analysis/options-deposit-insurance-reforms/
- Jiang, Matvos, Piskorski, and Seru, Monetary Tightening and U.S. Bank Fragility, used as research context on monetary tightening, unrealized losses, and bank funding fragility: https://www.nber.org/system/files/working_papers/w31048/w31048.pdf