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CSBS Community Bank Survey

Findings from the 2023 CSBS Annual Survey of Community Banks

This year’s Annual Survey of Community Banks, conducted by the Conference of State Bank Supervisors (CSBS) and state financial regulators, was issued in the wake of several macroeconomic headwinds, intensified by heightened deposit competition and uncertainty in the banking system, stemming from the failures of three large regional banks earlier in the year.

To develop the 2023 annual survey, CSBS staff met with key industry stakeholders to identify current issues of relevance to community banks. The survey was distributed by the state bank regulators from April to July 2023.

2023 Survey Findings

  1. Net interest margins were generally seen as the top external risk by community banks
  2. A majority of respondents reported higher costs of deposits as the most impactful effect of inflation
  3. Cybersecurity continues to be a top internal risk priority of community bankers
  4. Nearly all banks surveyed identified the adoption of new or emerging technologies as important

Board Chair Notes


The impact of continued high interest rates has hit Main Street.

The 2023 Annual Community Bank Survey shows that while net interest margins continue to be the top external challenge for community bankers for the second year in a row, their concerns in three related areas have risen dramatically.

More than 86% of respondents named cost of funds as either extremely or very important, a significant increase from the 48% who said so last year. Likewise, 83% of respondents called core deposit growth extremely or very important, up from only 38% a year ago. And liquidity concerns were cited by 83% of respondents as extremely or very important compared to 35% a year ago.

Meanwhile, community bankers ranked cybersecurity threats as their top internal concern once again.

This is the 10th year of our annual survey and looking through the years gives a great view of the top concerns and challenges of community banks. We are also fortunate to have insight from five community bankers who have provided a close-up look at their operations.

I’d like to thank everyone who participated. Your input is invaluable. The information is important to understand more about community banking and helps inform both regulators and policymakers.

To learn more about what’s on the minds of community bankers this year, I invite you to read the full report.

I. Lise Kruse
Board Chair, Conference of State Bank Supervisors
Commissioner, North Dakota Department of Financial Institutions


The CSBS Annual Survey of Community Banks is a look at community banker sentiment about the economy, compliance costs, inflation, technology and more.
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The CSBS Community Bank Survey is an annual look at community banker sentiment about the economy, compliance costs, inflation, technology and more.