The Community Bank Sentiment Index (CBSI)
The Community Bank Sentiment Index is an index derived from quarterly polling of community bankers across the nation. As community bankers answer questions about their outlook on the economy, their answers are analyzed and compiled into a single number. An index reading of 100 indicates a neutral sentiment, while anything above 100 indicates a positive sentiment, and anything below 100 indicates negative sentiment.
The 2026 Q3 Community Bank Sentiment Index Number
This represents a positive reading in sentiment by community bankers. Slipping nine points from the value of 129 recorded in last quarter's survey, the overall index remains well above the neutral level of 100.
Key Highlights
- At 120, the third quarter 2026 CBSI fell nine points from the second quarter survey and is down 13 points from its peak of 133 one year ago.
- Six of the seven components that comprise the CBSI decreased from the previous quarterly survey and one advanced.
- At 138, the profitability component declined 16 points from its peak level of 152 last quarter after it improved nine points from Q1 2026 to Q2 2026. The profitability indicator has remained at or above 129 during the last nine quarters.
- At 83, the future business conditions indicator dropped 16 points from the second quarter reading of 99. The business conditions indicator has been above the neutral level of 100 only once since 2021 when it hit 117 in the fourth quarter of 2024.
- At 70, the monetary policy component dropped another 26 points from last quarter, following an 11-point decline from Q1 2026 to Q2 2026. The monetary policy indicator is now off 60 points from its all-time high of 130, reached one year ago. This is the first time since the third quarter of 2023 that the monetary policy indicator has been this low, when the Fed Funds Target Rate was raised to range between 5.25% to 5.50%.
- At 106, the regulatory burden component fell seven points from last quarter and is down 24 points from its peak level of 130 reached one year ago. Community bankers’ optimism for a lighter regulatory environment in the coming year is fading somewhat, though still in positive territory. The regulatory burden indicator has remained at or above 100 for eight straight quarters, following fifteen consecutive quarters—from early 2021 to late 2024—when the indicator was consistently below 30 and indicated, at that time, a much heavier regulatory burden was expected.
- At 136, the operations expansion component slipped three points from last quarter, while the capital spending indicator improved four points to 145.
- At 160, the franchise value indicator slid five points from the previous quarter. It peaked six months ago at 170. The franchise value component has been above 150 over the past nine quarters.
- Read More on the 2026 Q3 Community Bank Sentiment Index Survey Results
- 248 community bankers from 38 states and the District of Columbia responded to the third quarter 2026 CBSI survey.
- In the open-ended comments, many community bankers voiced concerns over inflationary pressures stemming from the current geopolitical situation and persistently high oil prices and how these uncertainties might weaken the US economy. Community bankers also expressed concerns over the size of the federal debt, how the midterm elections might change the political calculus in Washington, and how to deal with growing fraud.
- The CBSI Uncertainty Index (computed by adding together the “I don’t know/unsure” responses for all seven components) rose two points to 27, indicating slightly more overall uncertainty than recorded in the previous quarter’s survey.
- In a special question, 49% of community bankers believe the U.S. economy is at the start of, or already in, a recession, up from 41% last quarter. Twenty-one percent of community bankers said the economy is at the start of an expansion, while 30% believe there is solid economic growth.
- In another special question, community bankers once again rated the following as their top concerns: cyberattacks, bank fraud, the federal debt/deficit, the cost and availability of labor, and competition. These are the same top five concerns bankers have had in the previous five quarterly surveys.
Interactive Dashboard
2026 Q3 CBSI Survey Results
In this interactive, you can click on a positive, neutral, or negative view in each subcategory to see how those respondents answered other questions. For example, if you click the "they will be better than today" green bar under business conditions, all other subcategories will update to display responses only by those people who believe future business conditions will be better than today. Clicking on the same item a second time will return you to the original display.
Data Behind the Index
Every quarter, the Community Bank Sentiment Index number will be accompanied with a release explaining the underlying data. Links to the releases are saved below.
Sentiment Index Findings