The year 2025 marked a period of significant transformation for the banking sector. On one hand, mergers and acquisitions (M&A) accelerated at an unprecedented pace, while on the other, applications for new banking charters experienced notable growth. Analysts suggest that 2026 is unlikely to merely continue these trends—it could see them intensify and evolve in more complex ways. Many observers regard the upcoming year as a “sequel” to 2025, with the previous year’s developments returning on a larger, more consequential scale.
According to data, a total of 181 M&A transactions were completed within the banking industry in 2025. Brian Graham, co-founder of financial advisory firm Claros Group, predicts that the number of such deals could nearly double in 2026. This surge is driven in part by accumulated pressures from the slow pace of activity earlier in the decade and relatively rapid assessment processes by regulatory authorities. Political uncertainty also plays a major role. Some analysts believe that, in anticipation of potential policy shifts ahead of midterm elections or the 2028 presidential contest, many banks will seek to finalise agreements sooner rather than later.
However, the impact of this activity will not be uniform across the sector. Smaller banks may find themselves under pressure, as mid-sized institutions that were once potential buyers are increasingly becoming targets for acquisition by larger banks. This dynamic risks creating a more constrained “buyer market” for smaller institutions.
Alongside M&A, applications for new banks—so-called “de novo” charters—are also on the rise. In 2025, the Office of the Comptroller of the Currency received 18 such applications. Michelle Alter, another co-founder of Claros Group, forecasts that this figure could reach 25 in 2026. Early applications from several major players suggest that the entry of new competitors is set to continue.
Regulatory oversight may also present a new picture in 2026. While some stringent rules from the previous administration were relaxed in 2025, the incoming regulatory framework could be reinforced. Trump-appointed regulators are expected to prioritise restructuring rules according to their policy perspective, potentially raising compliance and risk-management costs for banks.
A summary of key projected trends for 2026 is presented below:
| Sector Focus | 2025 Status | 2026 Projected Trend |
|---|---|---|
| Mergers & Acquisitions | 181 deals | Nearly double |
| New Bank Applications | 18 applications | Approximately 25 |
| Smaller Banks | Dependent on mid-sized buyers | Risk of constrained buyer market |
| Regulatory Oversight | Relaxed restrictions | Strengthened framework |
In summary, 2026 promises to be a year of both expansion and challenge for the banking industry. For large banks, smaller institutions, and new entrants alike, it will be a critical period for strategic planning, with opportunities for growth balanced against heightened competition and regulatory demands.