Despite continued inflationary pressures and economic uncertainty, Iowa’s banking industry finished the second quarter with year-over-year growth. The Federal Deposit Insurance Corp. state-specific data released Tuesday showed loan, deposit and asset growth from the prior year.

“This quarter’s results illustrate the strength of Iowa’s banking system and how it benefits Iowans ­– with loan growth to drive the state’s economy forward and a highly competitive financial marketplace,” said Adam Gregg, president and CEO of the Iowa Bankers Association. “Iowa banks are proud to be a trusted financial partner Iowans can count on.”

The 233 Iowa-domiciled banks saw an increase in loans this quarter to $89.4 billion, an increase of 4 percent from a year ago and a 1 percent increase from the previous quarter.

Deposits decreased slightly from last quarter; however, total deposits for the second quarter were $107.5 billion, compared to $103.5 billion the prior year.

Loan quality remains strong with average net loan charge-offs at just 0.05 percent, which signifies strong loan portfolios.

The noncurrent percentage of total loans at 0.66 percent for Iowa banks shows financial stability in the state, lower than the nation’s 0.96 percent

Total assets remain stable for Iowa banks this quarter at $129 billion, a slight increase from $128.9 billion in the first quarter.

Second quarter total assets were 2.9 percent higher than the same period in 2024.

Iowa banks had $725 million in net income through the second quarter. The competitive interest rate environment continues to have an impact on net interest margins, especially in Iowa, where there are more banks per capita than most states in the nation. The average return on assets, an overall indicator of bank performance, at Iowa banks was 1.13 percent in the second quarter, an increase from 0.97 percent in the second quarter 2024.