Street Talk

A sharp rise in commercial real estate originations in the second quarter of 2026, particularly among banks, signals a pivotal moment for the industry. Lenders are proactively addressing a massive wall of maturing loans, but the outlook is clouded by sticky inflation and evidence of an increasingly hawkish Federal Reserve.

In this episode of "Street Talk," Michael Fratantoni, chief economist for the Mortgage Bankers Association (MBA), unpacked the drivers behind a 16% year-over-year increase in total production captured by the organization's Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations. The most striking figure from the survey was a 61% surge in the origination index among depositories.

Fratantoni explained that this came in a direct response to a well-documented looming challenge. "Our estimate was that in 2026, there was going to be $875 billion worth of scheduled maturities for commercial mortgage loans this year and about half of those were sitting on depository balance sheets," he said. He noted that banks entered the year determined to address these loans, seeing it as an opportunity to, as he put it, "redesign the balance sheet a bit and provide financing, grow where you can and then also do that compositional change leaning into the areas of the market where you have more optimism."

While property types like industrial and multifamily continue to show strength, even the beleaguered office and retail sectors have shown signs of recovery. Fratantoni cautioned that the demand picture for multifamily is shifting, however, partly due to the demographic effect of a smaller Gen Z population cohort and changes in immigration policy, which could lead to a slowdown in new construction. The MBA's Commercial/Multifamily Mortgage Bankers Originations Index showed the sharpest year-over-year growth in office and retail production off of low bases with single-digit gains in industrial and multifamily volume off considerably higher bases.

Credits:

• Host: Tim Zawacki
• Guest: Michael Fratatoni
• Produced By: Feranmi Adeoshun
• Published With Assistance From: Melissa Peterson, Feranmi Adeoshun, Sophie Carr

Street Talk returns with new host, Head of Financial Institutions Research and Lead North American Insurance Analyst at S&P Global Market Intelligence, Tim Zawacki.

Seven months into the largest merger of US credit unions on record, First Technology Federal Credit Union President and CEO Shruti Miyashiro is focused on both the short-term intricacies of bringing together two bi-coastal institutions and the longer-term evolution of the business of banking.

The Jan 1st combination of First Tech, a San Jose-based credit union with a branch network focused on California's Silicon Valley and Oregon's Willamette Valley, with Digital FCU, a Marlborough, Mass.-based institution with a significant presence along Boston's Route 128 technology corridor, unites institutions with many similarities in their member compositions but the logistical and cultural complexities of bringing together entities headquartered some 3,100 miles apart.

In this episode, Miyashiro discusses the challenges and opportunities associated with the integration process and the evolution of consumer banking more broadly. And she offers a staunch defense of role played by credit unions in the US banking system.

In this episode:

• Progress First Tech has already made in creating the nation's sixth-largest credit union by asset size and the integration work that remains.
• The role that First Tech believes branches will or will not play in the bank of the future.
• Why Miyashiro believes US credit unions should continue to enjoy a federal corporate income tax exemption.

More S&P Global Market Intelligence content:

• Banking Essentials Newsletter
• Webinar: Transforming Credit Unions: Key M&A and Technology Trends in U.S. and Canadian Markets | S&P Global

For S&P Global subscribers (login required):

• Updated US Banking Industry Projections
• US credit union deal count drops in H1 2026, but merger sizes stay big

Credits:

• Host: Tim Zawacki
• Guest: Shruti Miyashiro
• Produced By: Carl Schmidt & Feranmi Adeoshun
• Published With Assistance From: Sophie Carr

In banking, boring wins, according to veteran bank investor Joe Stieven. The CEO of Stieven Capital Advisors discussed what drives value and how community banks will remain relevant over the next decade at S&P Global Market Intelligence's annual community bankers conference. The investor said his 12-word philosophy has guided decades of capital allocation through COVID, rate cycles, Silicon Valley's collapse, and now tariffs and geopolitical shock. Stieven says all banks should ask those 12 words, "How does this impact our earnings and tangible book value per share," when contemplating any strategy. The investor also discussed why he sees overhead discipline as a way of life, how AI is reshaping the sector, and what the M&A landscape looks like from his chair.

The post-WWII global order is entering a new era. In the episode recorded live at the S&P Global Market Intelligence's Annual Community Bankers Conference on May 6, geopolitical strategist and author Dr. George Friedman discusses the conflicts between the U.S. and Iran, and Russia and Ukraine, how America reinvents itself through instability, and the pivotal U.S.-China summit on May 14. Dr. Friedman's core argument: The entire Bretton Woods system—NATO, multilateral trade, the U.S.-European alliance—was built to contain the Soviet Union. The episode explores Russia's invasion of Ukraine, and a bilateral U.S.-China order that could reshape global economics for a generation.

Statements made by persons who are not S&P Global employees represent their own views and not necessarily those of S&P Global.

A few blips tied to private credit and loans to nonbank financial institutions have weighed on the bank group recently and come at the same time at the group faced pressure over concerns that greater adoption of artificial intelligence could threaten many traditional jobs and ultimately lead to higher levels of unemployment. However, some bank analysts argue that both issues might be overblown and that AI in particular could lead to efficiency gains for banks. In the episode, Greg Hertrich, managing director and head of US Depository Strategies at Nomura, discusses the real risks behind bank lending to private credit firms and nonbank financial institutions. Hertrich explains why these exposures aren't as "hidden" as some fear, why banks are better capitalized and more transparent than in past cycles, and how today's credit environment differs from previous crises. He also tackled concerns about AI's impact on the job market and argued that AI could prove an efficiency gain for banks rather than pose a great threat to the economy and banks' loan portfolios.

After years of trading at the steepest discount in the broader market—dead last among all major sectors—the banking industry is finally positioned to narrow that gap, according to KBW CEO Tom Michaud. In the episode, Michaud said that the best fundamental environment in years, historic levels of excess capital, a once in generational change in the regulatory environment and rebounding M&A activity should support stronger valuations for regional banks in 2026. The executive also shared his takeaways from the annual Acquire or Be Acquire conference and his outlook for bank deal activity. He further discussed why scale matters and the impact of shareholder activism in the banking sector.

While large bank stocks have significantly outperformed their smaller counterparts over the last few years, the tide could finally be turning, according to Jonah Marcus, partner and portfolio manager at Endeavour Capital Advisors, Inc.

In the episode, Marcus said there are positive tailwinds for the banking sector, including increasing bank M&A activity, net interest margin expansion and deregulation, that will serve as a greater benefit for small and mid-cap banks. The veteran investor also discussed the valuation disparity between large and small banks; his outlook for credit quality and bank M&A activity, and the importance of technology and a bank's data strategy.

Bank stocks are trading at their cheapest levels relative to the broader market in a decade, but a confluence of catalysts, including rebounding M&A activity, deregulation and rate cuts by the Federal Reserve could finally unlock value for the sector, according to Mendon Capital's Anton Schutz Sr. and Anton Schutz Jr. In the episode, the father-son investment team discuss the current state of bank stocks and what lies ahead for the sector. The Schutz team addresses the frustration many long-term bank investors feel— strong fundamental performance hasn't translated to higher stock prices. They downplayed recent concerns over losses related to loans to nondepository financial institutions and expressed confidence in the sector's credit fundamentals, contrasting the conservative lending practices of regulated banks with the riskier positions being taken in private credit markets. They also see several potential drivers for bank stock performance, including renewed M&A activity, regulatory changes favoring deregulation and the potential for interest rate normalization to benefit margins. The investors further discussed how AI and technology could dramatically improve bank cost structures, with particular emphasis on back-office operations rather than revenue generation.

Despite ongoing economic uncertainty and investors' concerns about potential slippage in credit quality, U.S. banks delivered strong third-quarter results that beat expectations across the board.

In the episode, Chris Nichols, Director of Capital Markets at South State, discusses third-quarter earnings trends, including the continued resilience of consumer spending, the stabilization of credit quality after several quarters of deterioration, and the unexpected strength in fee income. Nichols and Street Talk host Nathan Stovall dissect the controversy around loans to nondepository financial institutions (NDFI) following several high-profile credit losses, debating whether these incidents represent isolated frauds or canaries in the coal mine.

Nichols also highlighted strategic imperatives for banks heading into 2026 and argued that now is the time to rebuild deposit franchises through product innovation and marketing creativity—not rate competition. Nichols and Stovall also explore the reawakening M&A landscape as regulatory headwinds ease and activist investors enter the fray.

The world of cryptocurrencies has seen no shortage of upheaval, but regulatory clarity that has arrived with recent legislation is expected to lead to greater adoption of stablecoins. Some market participants and banks are worried the growth could lead to deposit cannibalization. In the episode, S&P Global Market Intelligence fintech analysts Jordan McKee and Sampath Sharma, and FIG Research Head Nathan Stovall talked about stablecoins, changes in regulation that could spur greater adoption, the potential threat to bank deposits, how traditional financial institutions are responding, and the challenges to further stablecoin growth.