Jim Dobbs

The KBW Bank Index posted a strong gain after a government report showed employers added 216,000 jobs in December. The labor market strength bodes well for lenders' credit quality but may delay highly anticipated interest rate cuts that would lower banks' funding costs.

A resilient economy and the potential for interest rate cuts could infuse further bullish sentiment into markets and bolster the shares of small lenders.

Overall merger-and-acquisition activity proved modest across the banking sector, but several prominent deals were reached. Read on for details of the year's biggest transactions.

Funding pressures moderated in recent months, but loan charge-offs climbed. With festering concerns about a vulnerable economy, the potential for elevated credits costs could loom large over the upcoming bank earnings season.

The lawsuit accuses Navy Federal of violating the Fair Housing Act and the Equal Credit Opportunity Act after a CNN report that the lender approved a lower percentage of Black and Latino mortgage applicants.

The world's largest credit union reported a 5% increase in total loans in the third quarter while lending at the largest banks was almost stagnant. However, the Vienna, Virginia, institution's charge-offs also jumped significantly.

The acquisition would deepen Orrstown's presence in its home state and Maryland. In recent years, Codorus Valley Bancorp had faced pressure from an activist investor to consider selling.

Proposed capital rules aimed at bigger institutions will force regional and larger community banks to consider ways to grow or seek an exit strategy, bankers and analysts predict.

Top industry executives said this week that price increases are abating, even if they haven't yet fully abated. Their remarks reflect increased confidence that the Federal Reserve will hold interest rates steady — or perhaps even cut them — in the first half of 2024.

Equity, based in Wichita, Kansas, has agreed to buy the parent company of the Bank of Kirksville. The combined company would have $5.4 billion of assets and 74 branches, including 23 in Missouri.