Key takeaways
- PNC average loans grow 14.2% year over year
- Commercial lending remains resilient despite elevated borrowing costs
- Bank executives report demand beyond AI infrastructure projects
US regional banks are reporting surprisingly strong loan growth despite elevated interest rates and concerns that expensive borrowing could weaken corporate investment.
PNC Financial Services led the latest results with approximately 14.2% year-over-year growth in average loans during the third quarter of 2026, while other lenders reported continued demand from businesses across several industries.
According to PNC's third-quarter earnings release, average loans reached $372.2 billion, compared with $325.9 billion a year earlier. The increase partly reflected PNC's acquisition of FirstBank alongside new commercial lending.
The results suggest corporate borrowing has remained more resilient than some investors expected, even as inflation and higher Treasury yields put pressure on financial markets.
PNC Loan Growth Reaches 14.2% as Commercial Lending Expands
PNC's average loan portfolio increased by approximately $46.3 billion from the third quarter of 2025.
Commercial loans accounted for most of the expansion, rising from $226.8 billion to $269.2 billion, an increase of nearly 19%.
Commercial and industrial lending grew particularly strongly as businesses increased borrowing and utilized existing credit commitments.
However, not all of the annual growth came from new lending activity. PNC's acquisition of FirstBank contributed to the increase, making it important to distinguish expansion through acquisitions from organic growth.
PNC also reported $2.1 billion in quarterly net income, up from $1.82 billion a year earlier, while revenue increased approximately 11% to $6.56 billion.
Net interest income climbed 15% to $4.21 billion, supported by loan growth and changes in funding costs.
These figures illustrate why expanding lending portfolios can support bank earnings even when financial markets remain volatile.
JPMorgan and Regional Banks Report Resilient Loan Demand
The strength extends beyond PNC.
According to Reuters, U.S. Bancorp, M&T Bank and Citizens Financial also reported encouraging commercial lending trends.
The results follow quarterly earnings from larger financial institutions, including JPMorgan Chase, Citigroup and Wells Fargo, which similarly reported rising loan balances.
Citigroup's quarterly performance was particularly strong, with a 40% profit increase contrasting with JPMorgan's earnings miss.
However, bank executives emphasized that loan demand was not concentrated exclusively in artificial intelligence.
PNC pointed to indirect benefits from investment in energy and transportation infrastructure, while U.S. Bancorp described borrowing activity across industries including retail, food and insurance.
The distinction matters because the enormous AI financing boom has raised concerns about whether technology investments are becoming excessively dependent on debt.
Companies building GPU clusters and data centers face especially high capital requirements, but their borrowing patterns are not necessarily representative of the broader corporate economy.
Can US Banks Maintain Growth With Interest Rates Elevated?
Strong loan demand is encouraging for lenders, but expanding credit portfolios also creates additional risks.
Higher borrowing costs can eventually strain customers' finances, while competition for deposits may force banks to pay more to retain funding.
Major US banks have already encountered increasing deposit competition, potentially limiting the benefit of higher interest rates for their net interest margins.
The contrast is particularly visible in the AI debt market, where rising default-insurance costs indicate greater investor concern about highly leveraged infrastructure companies.
