Wisconsin banks saw their combined net income increase nearly 20% in the first quarter of the year to $489 million, according to data from the FDIC.
The 158 banks based in the state also increased their combined deposits by 5.6% from a year ago to $129.7 billion. The increase from the end of 2024 was 0.9%.
Net loans and leases increased 4.5% year-over-year to $115.8 billion, a 1.1% increase from December.
Compared to March 2024, the total amount of residential real estate loans increased 8.7% to $32.8 billion while commercial and industrial loans increased 5% to $18.9 billion. Farm loans were also up 9% to $4.5 billion.
Banks did see an increase of 2.2% year-over-year of assets in nonaccrual status to $630.7 million.
“The first-quarter FDIC numbers reflect that 2025 has started off steady for Wisconsin banks with all areas of lending increasing year over year," said
Rose Oswald Poels, president and CEO of the
Wisconsin Bankers Association. "The increase in farm and commercial lending continued through the first quarter. The data also reflects that Wisconsin’s residential real estate market continues to be competitive. Across all categories of lending, banks continue to monitor credit quality and work with struggling borrowers as Wisconsin banks remain well positioned to continue to help meet the needs of their customers and communities.”
The improvement in profitability was helped by an increase in net interest income, which reached $1.23 billion, a jump of 12.8% compared to the start of 2024. Net interest margin for the quarter was 3.33%, up 23 basis points from a year ago and 11 basis points from the end of 2024.
Year-over-year, banks saw their yield on earning assets increase 9 points to 5.57% while the cost of funding those assets decreased 16 points to 2.23%.
However, compared to the end of 2024, yield was down by 9 points and cost was down 21 points.
Wisconsin banks also saw an increase in noninterest income as a percentage of average assets to 2.15%, a 17 basis point increase from a year ago and 10 points from the end of 2024.
Noninterest expense also rose by 20 points compared to a year ago and by 7 points from the end of the previous quarter, reaching 3.66%.
