New Hampshire Banks

Return on assets for New Hampshire banks stood at 0.68% in Q2 2026, 56 basis points below the national benchmark of 1.24%. Without quarter-over-quarter or year-over-year data, it is impossible to assess whether profitability is improving or deteriorating, but the current snapshot places the cohort in the bottom half of the national distribution. Net interest margin of 3.32% trailed the national 3.87% by 55 basis points, and the efficiency ratio of 72.35% exceeded the national 63.11% by 9.24 percentage points. The combination of compressed margin and elevated operating expense ratio accounts for the below-benchmark ROA.

The net interest margin gap is driven by two forces visible in the data: the noninterest-bearing deposit share of 14.23% (7.37 percentage points below national) mechanically raises funding costs, and the loan-to-deposit ratio of 91.83% (14.35 points above national) suggests the cohort is funding loans at the margin with higher-cost deposits or wholesale sources rather than low-cost core deposits. The efficiency ratio of 72.35% indicates that for every dollar of revenue, the cohort spends 72.35 cents on noninterest expense, versus 63.11 cents nationally. This 9.24-percentage-point gap is substantial and cannot be explained by margin compression alone; it reflects either higher unit operating costs or lower revenue density per dollar of assets. The net interest income as a percentage of revenue at 2.02% (1.36 points above national) is a revenue-mix metric, not a profitability measure, and does not offset the efficiency drag.

Specialization context from the national data shows Mortgage specialists at a 75.25% efficiency ratio, 12.13 points above the national 63.11%, while Credit Card specialists achieved 54.40%, 8.71 points below national. New Hampshire's 72.35% efficiency ratio is closer to the Mortgage-specialist profile than to the more efficient Commercial or Credit Card categories, suggesting a cost structure or revenue mix challenge. Without tier or specialization breakdowns specific to the 17 New Hampshire banks, it is unclear whether the efficiency gap reflects small-bank scale constraints or operational inefficiency, but the 9.24-point gap to national is material and persistent expense discipline will be required to close it.

New Hampshire banks posted loan growth of 6.24% in Q2 2026, 8 basis points above the national benchmark of 6.16%, while asset growth of 4.13% trailed the national 5.17% by 1.04 percentage points. Deposit growth of 3.25% lagged the national 4.93% by 1.68 percentage points. Without quarter-over-quarter or year-over-year data, it is impossible to assess whether growth is accelerating or decelerating, but the current snapshot reveals a cohort growing loans faster than deposits and faster than total assets, creating structural tension in the balance sheet.

The loan-growth-to-deposit-growth divergence is the defining growth dynamic: loans expanded 6.24%, deposits only 3.25%, a 2.99-percentage-point gap. This divergence mechanically drives the elevated loan-to-deposit ratio of 91.83% (14.35 points above national 77.48%) and forces the cohort to fund incremental loan originations either through deposit repricing, wholesale funding, or asset reallocation. Asset growth of 4.13% ran below loan growth of 6.24%, suggesting the cohort is shrinking non-loan assets (securities, cash) to fund loan expansion or experiencing deposit runoff that offsets loan growth at the total-balance-sheet level. The national pattern shows asset growth of 5.17% and loan growth of 6.16%, a 0.99-point gap; New Hampshire's 2.11-point gap (6.24% loans minus 4.13% assets) is more than twice as wide, indicating a more aggressive loan-deployment strategy or a weaker deposit franchise.

The growth posture is unbalanced: strong loan origination velocity (6.24%, above national) paired with weak deposit acquisition (3.25%, 1.68 points below national). This imbalance is sustainable only if the cohort can continue to reprice deposits upward to attract funds or if loan growth decelerates to match deposit growth. The 17-bank cohort size limits statistical inference, but the current snapshot suggests New Hampshire banks are prioritizing loan market share over deposit franchise stability. If deposit growth does not accelerate to match loan growth, the loan-to-deposit ratio will continue to climb from its already-elevated 91.83%, further compressing liquidity and increasing reliance on rate-driven deposit retention.

New Hampshire banks reported a delinquency rate of 0.52% in Q2 2026, 19 basis points below the national benchmark of 0.71%, and a nonperforming asset ratio of 0.36%, 16 basis points below the national 0.52%. Tier 1 capital stood at 13.21%, 1.05 percentage points below the national 14.26%. Without quarter-over-quarter or year-over-year data, it is impossible to assess whether asset quality is improving or deteriorating, but the current snapshot places the cohort in favorable position on credit metrics and slightly below national on capital.

The delinquency and NPA ratios both run below national benchmarks, indicating a loan portfolio with lower observed credit stress than the broader FDIC-insured universe. The 19-basis-point gap on delinquency and 16-basis-point gap on NPAs are material and suggest either conservative underwriting, favorable borrower mix, or early-stage portfolio seasoning that has not yet cycled through a stress period. The Tier 1 capital ratio of 13.21% exceeds the 6.0% regulatory well-capitalized threshold by 7.21 percentage points, so the cohort remains well-capitalized by regulatory standards, but the 1.05-percentage-point gap to the national 14.26% is notable given the elevated loan-to-deposit ratio of 91.83% and the loan-growth-to-deposit-growth divergence. A cohort growing loans faster than deposits and faster than assets while holding below-national capital is operating with less cushion against unexpected credit losses or funding shocks.

The risk profile is stable on credit quality but constrained on capital and liquidity. The low delinquency and NPA ratios provide no immediate cause for concern, but the 13.21% Tier 1 capital ratio paired with a 91.83% loan-to-deposit ratio and 6.24% loan growth (versus 3.25% deposit growth) creates a forward-looking tension. If loan growth continues to outpace deposit growth and capital accumulation, the cohort will face either capital erosion or the need to slow loan originations. The national data shows Agricultural specialists at 0.66% delinquency and Credit Card specialists at 2.30%; New Hampshire's 0.52% suggests a portfolio mix tilted away from higher-risk categories, but without specialization or loan-type detail for the 17-bank cohort, the composition remains opaque.

New Hampshire banks operated with a loan-to-deposit ratio of 91.83% in Q2 2026, 14.35 percentage points above the national benchmark of 77.48%. Historical trend data is unavailable for quarter-over-quarter and year-over-year comparison, but the current snapshot reveals a cohort deploying deposits into loans at a materially higher rate than the broader FDIC-insured universe. This elevated LDR signals either a constrained deposit franchise or an aggressive loan origination strategy that outpaces funding growth.

The noninterest-bearing deposit share of 14.23% trailed the national 21.60% by 7.37 percentage points, indicating a deposit mix skewed toward interest-bearing accounts. This composition mechanically raises funding costs and compresses net interest margin. The net interest income as a percentage of revenue metric at 2.02% exceeded the national 0.66% by 1.36 percentage points, though this figure measures NII relative to total revenue rather than assets and reflects revenue mix rather than margin efficiency. Without prior-period data, it is impossible to assess whether the noninterest-bearing share is eroding or stable, but the current gap to national suggests New Hampshire banks face higher deposit betas than peers.

The engagement posture is mixed: the high LDR reflects strong loan deployment, but the low noninterest-bearing share and lagging deposit growth (3.25% versus national 4.93%) suggest funding pressure. The 6.24% loan growth rate slightly exceeded the national 6.16%, but deposit growth lagged by 1.68 percentage points, creating a structural tension. If loan growth continues to outpace deposit growth, the cohort will face increasing reliance on wholesale funding or rate-driven deposit acquisition, both of which compress profitability. The current LDR of 91.83% leaves limited liquidity cushion relative to the national 77.48%, and the funding mix skew toward interest-bearing accounts amplifies sensitivity to deposit pricing competition.