Finance Desk

Financial sector jobs grew in April, but a record wage gap challenges the industry’s recovery.

There might be a light at the end of the tunnel for job safety in commercial banking — or it could be the light of an oncoming train.

After more than 12 months of continuous job losses, commercial banks may be turning the corner. The ADP National Employment report for April 2026 noted that the financial activities sector grew by 9,000 positions, 5,000 more than the previous month.

The sector added the fourth-most jobs, behind education and health services (61,000); trade, transportation, and utilities (25,000); and construction (10,000). Only professional and business services saw a decline, with 8,000 jobs lost in April.

Meanwhile, the Bureau of Labor Statistics (BLS) is both more bullish and bearish compared to the ADP findings. The BLS calculated that the economy added 115,000 non-farm payroll jobs in April, while ADP saw private sector employment increase by 109,000 jobs, based on the anonymized weekly payroll data of more than 26 million private-sector employees.

On the other hand, BLS noted that employment in financial activities “showed little change over the month.”

AI Warning

The slight upswing seen by ADP could be a reversal of monthly job losses in commercial banking from February 2025, according to research by KBRA Financial Intelligence (KFI). But there’s a catch.

“Recent declines have been markedly narrower than those recorded in 2023 and 2024, suggesting that a consolidation of the commercial banking workforce could be slowing, but the ongoing implementation of AI within the industry could continue to shrink headcount at some banks,” according to a KFI Insight report.

Growth Spurt

So, where’s the greatest job growth? At the smallest and largest organizations.

The micro/small (1-19 employees) and large enterprises (more than 500 employees) led in job growth,  with 43,000 and 42,000 positions, respectively. Only companies at the upper end of the mid-sized enterprise range (250-499 employees) cut, jettisoning 3,000 jobs in April.

“Small and large employers are hiring, but we’re seeing softness in the middle,” said Dr. Nela Richardson, chief economist at ADP. “Large companies have resources to deploy, and small ones are the most nimble, both important advantages in a complex labor environment.”

Wage Worries

It’s not all good news. According to Bank of America Institute, which bases its numbers on aggregated and anonymized bank transaction data, unemployment payments continued to slow, but a large K-shape in wage growth continued into April.

“In April, higher-income households saw their after-tax wage growth rise to 6.0% year-on-year (YoY) — the highest rate we’ve observed since August 2021,” wrote the authors of the April 2026 Employment Report from the Institute.

“In fact, even within this cohort, there is a divergence, with after-tax wage growth for the highest 5% of households by income stronger than that of the rest of the higher-income cohort,” the authors noted.

“Middle- and lower-income households also saw increases in their after-tax wage growth in April, to 2.3% YoY and 1.5% YoY, respectively,” the researchers found. “But the gap between these cohorts and higher-income households remains at its widest level since our data series began in 2015.”

Tighter financial conditions and currencies relatively firmer against the dollar defined the Latin American macroeconomic backdrop.

Household cash flows proved mostly resilient across the region, supported by solid labor markets. On the other hand, corporate activity became more cautious, shaped by higher funding costs and a more uncertain global environment.

In the banking sector, selectivity was the year’s defining theme, as global banks largely maintained their multiyear retrenchment from noncore markets while regional players focused more on consolidating scale where it could be translated into tangible returns. As a result, growth became more targeted, with institutions prioritizing efficiency by focusing on the core geographies and segments where they held clear competitive advantages.

Fintech further consolidated its role as a foundational layer of the region’s financial system, prompting banks to deepen partnerships and use digital platforms to close product gaps, accelerate distribution, and oftentimes expand inorganically.

The result was a banking model that became more focused, increasingly defined by the ability to operate effectively within tighter strategic boundaries.

Caribbean economies entered 2025 supported by resilient tourism flows and solid remittance activity. Even so, growth across the region remained moderate, constrained by global uncertainty, tight public finances, and a still-cautious policy environment.

Against this backdrop, the region’s banks focused on strengthening core operations. Investment in digital infrastructure continued alongside efforts to streamline onboarding, reduce friction, and broaden access. Growth was still underpinned by an expanding customer base; but institutions pursued growth more selectively, placing greater emphasis on credit quality and risk-adjusted returns.

In Central America, banks relied on strengthening their funding bases, aiming to take advantage of the resilience of household cash flows across the region. While client and portfolio expansion was mostly moderate, a pickup in remittances during the first half of the year helped support overall profitability. Credit growth remained relatively strong even as corporate lending slightly moderated.

This translated into a year defined by efficiency for the industry, as institutions kept pushing digital adoption and electronic transactions higher and focused more closely on asset quality and operating discipline.

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Latin America

Itau Unibanco

Our Best Bank in Latin America, Itaú Unibanco, stood out for translating those conditions into superior profitability without sacrificing balance-sheet quality.

Even in a more selective credit environment, the Brazilian giant’s recurring net income rose 13.1% year over year (YoY) to 46.8 billion Brazilian reais ($8.5 billion). Return on equity (ROE) reached 23.4%, among the strongest in the region. Deposits grew 9.3% to 1.7 trillion reais, and loans expanded 6% to nearly 1.5 trillion reais, reflecting continued commercial momentum even as credit conditions became more selective.

Digital execution remained another differentiator for the bank. Through the continued rollout of its One Itaú super app, the bank reached a solid benchmark in digital channels: 97% of interactions with individual clients and 98% with corporate customers, helping to improve the consolidated efficiency ratio to 38.8%.

Caribbean

Scotiabank

Across the Caribbean, Scotiabank maintained strong capital positions and disciplined cost management while investing in digital capabilities and client experience, which improved profitability, digital adoption, and credit quality underpinning performance.

Central America

Davivienda

By combining scale expansion with disciplined execution and continued digital investments, Davivienda consolidated its position as one of the region’s leading institutions, in terms of reach and breadth of offerings in 2025.

Building on the integration of Scotiabank’s operations in Colombia, Costa Rica, and Panama, completed in December 2025, the bank ended the year with an expanded footprint. Total assets reached $64.3 billion, while its customer base exceeded 27 million across six countries.

Argentina

Banco Galicia

In Argentina, Banco Galicia excelled by betting on network expansion and service growth during a year defined by a gradual normalization of financial conditions and dwindling inflation. While the country’s broader economy expanded 4.6% in 2025 after contracting in 2024, the recovery was arguably uneven and sector focused, as household consumption contracted amid a more challenging labor market.

Against this evolving backdrop, the bank focused on integrating recently acquired HSBC Argentina’s franchise and on continuing to expand its best-in-country service network to capture renewed banking activity. By mid-2025, total assets had risen to 30.2 trillion Argentine pesos ($25.4 billion), up 33% from a year earlier. Meanwhile, the loan portfolio reached 14.4 trillion pesos, an increase of roughly 95% YoY.

On the digital front, Galicia continued to expand the reach of its ecosystem through Naranja X, which by mid-2025 had grown to 9.8 million credit cards and 7.9 million deposit accounts, with 81% of clients using digital channels. The group also joined Argentina’s first real-time interbank fraud-intelligence network, reflecting the increasing scale and sophistication of digital banking activity across the system.

Bahamas

Scotiabank Bahamas

Scotiabank Bahamas reached record profitability with a pretax income of $78.3 million in 2025—the highest in 16 years. The bank also reinforced its lead in digital banking, with virtually all transactions now executed through electronic channels, supporting cost optimization and improved client experience.

Barbados

Scotiabank Barbados

Scotiabank Barbados’ net profits rose to 87.4 million Barbadian dollars ($43.7 million) while return on equity reached 23%, reflecting improved efficiency and cost control.

Belize

Belize Bank

With a market share of over 40%, Belize Bank benefited from continued expansion of the domestic banking system in 2025. Its total assets reached record levels, to post significant improvements in presence and product offering.

Bermuda

Butterfield Bank

In Bermuda, Butterfield Bank delivered stable performance, supported by a strong balance sheet with total assets of $14.1 billion in 2025.

Bolivia

Banco Mercantil Santa Cruz

Banco Mercantil Santa Cruz continued to consolidate its position as Bolivia’s leading private-sector bank in 2025, extending its leadership in both lending and deposits while maintaining solid profitability growth. Total assets reached almost $6.6 billion, up 4.4% YoY. Deposits rose to nearly $5.2 billion. Net profit totaled $60.2 million, with ROE of 16.3%, one of the best in its category.

Brazil

BTG Pactual

BTG Pactual continued to place margins and client growth at the forefront of its operation in the region’s largest market, Brazil. The bank focused on its capital-light, platform-driven model to expand client activity across wealth, investment banking, and digital distribution.

As a result, the bank posted record numbers across the board. Adjusted return on average equity reached 26.9%, total revenue rose to 33 billion reais, and market capitalization climbed to 205 billion reais, underscoring investor confidence in one of the region’s most consistently high-performing financial institutions. BTG ended the year with 2.5 trillion reais in assets under custody and management.

Eying the region’s growing sustainability transition, BTG also partnered with the International Finance Corporation to mobilize up to $1 billion in sustainability and development financing across Latin America through 2028.

Cayman Islands

Butterfield Bank

In the Cayman Islands, Butterfield Bank focused on strengthening client experience and accessibility. In 2025, the bank upgraded its online and mobile platforms for retail and corporate clients. It also launched initiatives such as an enhanced Young Savers account and financial education partnerships.

Chile

Banco de Chile

Banco de Chile delivered another year of consistent outperformance in an economy marked by lower inflation, falling interest rates, and still-muted real credit growth, all of which reduced the sector’s earnings tailwinds.

In the face of this challenging environment, Banco de Chile continued to strengthen its position through efficiency gains and digital expansion, including a 24.5% growth in the bank’s FAN digital accounts as well as the launch of Banchile Pagos, a move that helped deepen the bank’s leadership in both scale and customer experience in the country.

Colombia

Banco de Bogotá

In Colombia, Banco de Bogotá operated in a still-restrictive environment, with inflation at 5.1%, policy rates at over 9.2%, and a stronger Colombian peso (up by more than 17% to the US dollar), all of which continued to weigh on margins and credit demand. Against that backdrop, the bank delivered steady balance-sheet growth: Total assets rose 6% to 155.8 trillion pesos ($41.4 billion); loans were up 4.8% to 109.4 trillion pesos; and deposits increased 7.7%. Asset quality improved, with nonperforming loans declining to 3.6%.

The bank also continued to accelerate its digital-expansion plan, processing 1.6 billion transactions in 2025—a massive 59% YoY increase—positioning Banco de Bogotá at the forefront of one of the world’s most digitally integrated banking systems.

Costa Rica

BAC Credomatic

In Costa Rica, BAC Credomatic delivered a solid performance in 2025, supported by sustained consumer-lending demand and strong activity in the bank’s payments and card businesses. BAC maintained a diverse revenue base, balancing lending growth with fee-based income from transactional services.

During the year, BAC advanced its strategic focus on small and midsize enterprises and sustainable financing. It continued to expand digital channels and payments across its Costa Rican franchise. As a result, for the first nine months of 2025, BAC International Bank reported net income of $586 million, up from $538 million a year earlier.

Dominican Republic

Banreservas

The Dominican Republic’s largest financial institution, Banreservas, continued to expand its role in key segments, capturing over 60% of remittance flows within the financial system in 2025. During the year, it completed implementing the Finastra Essence core banking platform, which improved processing efficiency and enabled real-time, digital-first services.

Ecuador

Produbanco

In Ecuador, Produbanco benefited from a more supportive macro backdrop in 2025, as bank profits in the country jumped a massive 43% YoY from a difficult 2024. In that environment, the bank continued to grow above the market: Net income for 2025 reached $85.2 million, roughly double from the year prior; and the loan portfolio was up 13.7% YoY by September 2025, supported by stronger commercial activity and improving credit dynamics. Profitability also strengthened.

At the same time, the bank continued to deepen its strategic positioning through sustainable and digital finance. Produbanco’s sustainable portfolio surpassed $1 billion, including $373 million in green financing, up 80% from 2023.

El Salvador

Banco Cuscatlán

A focus on digital expansion and credit resilience was the secret behind Banco Cuscatlán’s above-average performance in El Salvador. The bank outperformed the competition, with total assets increasing 13.5% YoY to over $4.8 billion.

Last year, Banco Cuscatlán continued to advance its digital and operational capabilities, including the expansion of its YA ecosystem and fully digital lending offerings. The bank also strengthened its regional footprint by migrating a $41.8 million mortgage portfolio.

Guatemala

Banco Industrial

Banco Industrial continued to benefit from structural growth opportunities in Guatemala, leveraging the bank’s market-leading position to further growth. As a result, the bank’s total assets reached 184.7 billion Guatemalan quetzales ($24.1 billion), up 14.8% YoY. Growth was supported by a combination of corporate lending strength and expanding retail reach, alongside continued investment in digital infrastructure.

Guyana

Scotiabank Guyana

Rapid economic expansion continued to shape results at Scotiabank Guyana, where assets grew 37% in 2025, driven by rising deposits linked to the country’s oil and gas sector.

Honduras

Banco Ficohsa

As Honduran banking assets expanded by 7.8% YoY in 2025, Banco Ficohsa found itself well positioned to capitalize on its nearly 19% market share in assets and 18% in loans, translating systemwide growth into continued balance-sheet expansion and lending activity.

Jamaica

National Commercial Bank Jamaica

National Commercial Bank Jamaica delivered a strong rebound in 2025. Net profit more than doubled to 13.2 billion Jamaican dollars ($82.9 million), supported by a 19% increase in total operating income.

Mexico

Banorte

In the region’s second-largest economy, Mexico, Banorte was well positioned to take advantage of a more resilient domestic macro backdrop in 2025, leveraging rebounding household demand and easing macroeconomic pressures to deliver another year of strong, broad-based performance. Net income rose to 58.8 billion Mexican pesos ($3.3 billion), while ROE reached 22.8%, and the cost-to-income ratio remained low at 35.8%, reflecting continued strength in both profitability and operating discipline.

That performance was reinforced by the bank’s growing breadth in commercial and strategic execution. Consumer lending expanded 12% YoY by mid-2025, supported by particularly strong growth in auto loans (30%), credit cards (18%), payroll lending (9%), and mortgages (8%).

Banorte also deepened its reach through the addition of retail giant Oxxo to its correspondent network. The bank also expanded its digital capabilities through a renewed partnership with Google Cloud, aimed at scaling AI, analytics, and personalization across the franchise.

Nicaragua

Banco LAFISE Bancentro

During 2025, Banco LAFISE Bancentro in Nicaragua reached record profitability and a highly resilient balance sheet. Net income rose 24% YoY to $69.4 million, accounting for 31.1% of total system profits. Return on equity (RoE) increased to 17.2%, making LAFISE the only major bank in the country to improve profitability during the year.

Panama

Banco General

In Panama, Banco General continued to act as the banking system’s anchor institution in 2025, leveraging the bank’s scale and deeply embedded client base to sustain growth. The bank retained its leading position with a 26.9% share of deposits and 18.1% of loans, reflecting its central role in channeling liquidity and credit across the economy.

Net income rose 5.7% YoY to $829.3 million. RoE remained strong at 24.1% and the efficiency ratio low at 28.3%, supported by steady activity across core segments.

Paraguay

Banco Continental

Amid another year of solid economic growth in Paraguay, Banco Continental continued to leverage its scale to deliver standout profitability. Total assets reached approximately $5.5 billion, up nearly 10% YoY, supported by a loan portfolio of nearly $4.1 billion and deposits of nearly $3.4 billion. Just as important, asset quality remained exceptionally strong, with nonperforming loans below 1%, reinforcing the bank’s ability to grow without compromising underwriting discipline.

Peru

Banco de Crédito del Perú

Banco de Crédito del Perú (BCP) benefited from one of the more supportive banking environments in the region in 2025, as economic growth recovered, inflation stayed near target, and easing rates helped revive financial activity. BCP continued to anchor its parent Credicorp’s universal banking performance, helping drive group net income to over 6.9 billion Peruvian soles ($2.1 billion) and ROE to 18.6%, while preserving the bank’s leadership in Peru’s loans and deposits markets.

Puerto Rico

Banco Popular de Puerto Rico

Banco Popular de Puerto Rico delivered a strong performance in 2025. Net income rose 36% year-on-year (YoY) to $833 million, supported by solid revenue growth and stable credit quality. Total assets reached approximately $75 billion, with deposits of $66.2 billion and loan balances around $39 billion.

Trinidad & Tobago

Republic Bank

With total assets reaching approximately 127 billion Trinidadian dollars ($18.7 billion) in 2025, Republic Bank continued to strengthen its position in Trinidad and Tobago, supported by steady balance sheet growth of over 6% YoY.

Turks & Caicos

Scotiabank Turks & Caicos

For Scotiabank Turks & Caicos, the focus was on steady growth and client accessibility. Total assets increased by 5.2% to $708 million in 2025.

Uruguay

Banco Itaú Uruguay

Banco Itaú Uruguay also takes our Best Bank award, in its country, for posting significant growth without sacrificing capital efficiency. At the end of 2024, the bank expanded its digital-payments capabilities through the acquisition of local fintech Plexo while continuing to build on the scale of the bank’s card and consumer-finance franchise.

US Virgin Islands

FirstBank

FirstBankmaintained stable credit performance and low levels of nonperforming assets to post consistent growth in the US Virgin Islands. During the year, the bank advanced its digital transformation through continued migration to cloud-based infrastructure.

Venezuela

Mercantil Banco Universal

In its centennial year, Mercantil Banco Universal outperformed by remaining one of Venezuela’s fastest-growing banks. It added more than 62,000 new customers and installed over 10,000 new card-payment terminals. The historic institution also continued to invest heavily in technology, migrating 650,000 debit cards to contactless technology and more than doubling YoY usage of its MIA (Mercantil Inteligencia Artificial) AI assistant to more than 1.5 million users.

Chinese AI firms dominate Hong Kong IPOs with $22 billion in exits, while US tech listings lag amid investor skepticism.

China’s artificial intelligence companies are driving a sharp divergence in global IPO markets, dominating first-quarter listings in Hong Kong and outpacing U.S. tech peers as investor sentiment fractures across regions.

Consider the trend: Chinese AI firms listed in Hong Kong accounted for four of the largest public listings in the first quarter. According to new data from PitchBook, these companies — Z.ai, MiniMax, Biren Technology and Iluvatar CoreX Semiconductor — collectively helped drive more than $22 billion in AI-related exit value during the quarter.

Adding Edge Medical, a surgical robotics company, brings the total for all five Chinese listings to over $24 billion.

The performance stands in sharp contrast to the muted reception many U.S. technology IPOs have faced. Investors have grown increasingly skeptical of richly valued software companies amid concerns that AI could disrupt traditional software business models.

“It’s genuinely a confluence of factors rather than any single driver,” Harrison Rolfes, senior research analyst at PitchBook, told Global Finance. “The DeepSeek moment in early 2025 fundamentally shifted investor perception of Chinese AI capability, and that rerating carried momentum into these listings.”

Rolfes said geopolitical considerations also played a major role, creating what he described as a “national champion premium” among investors in Hong Kong and broader Asian markets.

“Structurally, these companies came to market at more digestible valuations relative to their growth profiles compared to U.S. tech IPOs, which have repeatedly disappointed at high entry multiples,” he said.

Investor enthusiasm surrounding Chinese AI firms has emerged as U.S. IPO performance deteriorates.

A Record Stretch of IPO Underperformance

According to PitchBook data, the median U.S. IPO has underperformed its benchmark by 42 percentage points within 120 days of listing over the trailing 12 months.

“That’s historically the worst stretch in our dataset,” Rolfes said.

PitchBook noted that 2025 already represented a record low, with median IPOs trailing benchmarks by 35.6 percentage points after 120 days. Early 2026 listings are performing even worse, according to the report.

The closest comparison, Rolfes said, was the post-boom correction in 2021, when median U.S. IPOs lagged their benchmarks by 32 percentage points following aggressive pricing during the .

Globally, the median venture capital-backed IPO has underperformed the Morningstar U.S. Market Broad Growth Extended Index—a broad U.S. equity benchmark—by nearly seven percentage points over the past year. In the U.S., the index as a growth-stock yardstick shows that the gap widens sharply to 42 percentage points within 120 days of listing.

Roughly 66% of companies that have gone public since the start of 2025 are currently trading below their IPO prices, PitchBook found.

“The deterioration is progressive, suggesting that initial pricing optimism is giving way to fundamental reassessment as lockup expirations approach and more information reaches the market,” according to the May 5 report.

The divergence in performance has been particularly stark among high-profile tech listings.

SaaSpocalypse to Blame?

CoreWeave, based in Livingston, New Jersey, saw its shares nearly triple since its debut as investor demand for AI computing infrastructure accelerated. But many other venture-backed listings have struggled—badly.

Among the U.S.-listed laggards are shares of eToro, down 45.2%; Netskope, down 61%; Klarna, down 67.1%; Figma, down 85.7%; and Gemini Space Station, down 86.3%.

PitchBook said broader public SaaS markets have also weakened as investors increasingly treat AI as a threat to incumbent software firms rather than a growth catalyst.

“Public markets appear to be treating AI not as a tailwind for existing software but as a displacement risk, which many are calling a ‘SaaSpocalypse,’ in which incumbents are repriced downward even as private AI unicorns command record valuations,” according to the report.

For investors, the divergence raises questions about whether U.S.-listed AI companies still offer the best risk-adjusted exposure to the global AI boom.

“The companies leading Hong Kong’s surge — semiconductor designers, applied AI platforms and robotics-adjacent businesses — are generating real revenue with defensible vertical positioning, and they have outperformed their U.S. counterparts by a wide margin,” Rolfes said.

What’s Next?

Expect investors to take a closer look at how heavily their portfolios are tilted toward specific geographies, considering AI-related valuation premiums are persisting longer in Hong Kong than in New York.

Rolfes also cautioned that some of the highest-valued Chinese AI names could eventually face corrections. Still, the underlying businesses are stronger than many Western investors have assumed, he argued.

“The broader takeaway,” he said, “is that Chinese AI has likely graduated from a risk to monitor to a market to understand.”