With the Fed hinting at possible rate hikes and keeping markets guessing on how long higher borrowing costs might last, rate sensitive banks and insurers sit in a very different spotlight than they did a year ago. That uncertainty can reshape earnings power and investor sentiment. This article explains what that backdrop could mean in practice and examines three large US financial stocks that appear especially exposed to these Fed signals.
The stocks covered below are just a sample of the idea, and the full screen surfaced 35 more large US financial companies with similarly compelling income, valuation, and balance sheet stories that are not covered here. To identify and analyze the highest conviction opportunities from that broader group, head straight to the US Financials – Rate-Sensitive Banks and Insurers screener.
Farmers National Banc (FMNB)
Overview: Farmers National Banc is a regional bank holding company based in Ohio that earns most of its money from traditional banking, including deposits, commercial and mortgage lending, and related services that are closely tied to US interest rates. It also offers trust, retirement consulting, insurance and financial management services, which add fee income and broaden its role in customers’ long term financial planning.
Operations: Farmers National Banc generates the bulk of its US$218 million in revenue from its Bank Segment at about US$162 million, with additional contributions from unallocated other revenues of about US$41 million and roughly US$16 million from its trust and retirement consulting segment, all within the United States.
Market Cap: US$927 million
Farmers National Banc gives you direct exposure to a regional lender whose earnings are closely linked to net interest margins and investment income. This can be especially relevant if the Fed keeps rates higher for longer. Recent results show stronger net interest income and higher net income, while a 4.33% dividend yield offers an income stream that many large banks do not match. At the same time, insider selling, past dilution and a modest 8.5% ROE mean you may want to think carefully about capital allocation and execution risk, particularly with a relatively new management team. For investors who want a rate sensitive bank with income appeal and potential growth, the full story behind Farmers National Banc may warrant a closer look.
Farmers National Banc combines rate-sensitive income with a 4.33% yield that many larger peers do not match, yet insider selling and dilution still raise questions about the next chapter. Get the full picture in the 4 key rewards and 2 important warning signs (1 is major!)
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Farmers National Banc and the two other featured financial stocks all came from the same Simply Wall St filters, and you can run the same kind of search yourself. Use our flexible Screener to mix metrics like valuation, dividends, and balance sheet strength, or start with any of our curated Investing Ideas for ready made shortlists.
Five Star Bancorp (FSBC)
Overview: Five Star Bancorp is the holding company for Five Star Bank, a Northern California lender focused on small and medium-sized businesses and local households. Its earnings are closely tied to US interest rates through loan and deposit pricing. It offers everyday banking, business lending, real estate and agribusiness loans, and digital services that feed directly into net interest margin and fee income in a higher for longer rate setting.
Operations: Five Star Bancorp generates all of its approximately US$168 million in revenue from its core banking operations in the United States.
Market Cap: US$1.1 billion
For investors looking at rate-sensitive banks, Five Star Bancorp brings a focused Northern California franchise, a large base of adjustable or floating loans and a track record of strong net profit margins that tie directly into the Fed’s latest signals on possible further hikes. Analysts see healthy revenue and earnings growth, while recent insider buying and a regular cash dividend hint at management confidence and income appeal. The flip side is meaningful exposure to commercial real estate, concentrated deposits and a single-region footprint, at a P/E that is higher than the broader US Banks group. If you want to understand whether that risk and reward mix suits your portfolio, the details behind Five Star Bancorp’s growth plans, margins and capital raising are worth a closer look.
Five Star Bancorp’s strong net profit margins and focused California franchise can look appealing, but investors should also consider how its commercial real estate exposure and P/E premium fit together. Get the full story in the analysis report for Five Star Bancorp
HBT Financial (HBT)
Overview: HBT Financial is a US regional bank holding company for Heartland Bank and Trust, providing loans, deposit accounts and related services to consumers, businesses and municipalities across Illinois and Eastern Iowa. This ties its profitability closely to US interest rate levels. Alongside core lending and deposits, HBT Financial also offers trust, investment management, retirement plan services and farm management, giving it multiple income streams that can respond differently to higher or sustained rates.
Operations: HBT Financial generates about US$266 million in revenue from its Community Banking segment, all within the United States.
Market Cap: US$1.3 billion
HBT Financial gives you a rate-sensitive community banking platform that already shows solid earnings power, with net interest income of US$69.06 million and net income of US$27.84 million in Q2 2026, plus a growing dividend that recently moved to US$0.25 per share. The stock trades below the Simply Wall St estimate of fair value. Analysts expect strong growth in both earnings and revenue, which ties directly into a higher-for-longer Fed stance that could keep loan yields attractive if funding costs are well managed. At the same time, dilution over the past year, only moderate ROE and a P/E above the US Banks peer average mean you are paying for that growth story. The planned Tri-County acquisition and a larger branch footprint add another layer of potential upside and integration risk that careful investors may want to understand in more detail before deciding how HBT Financial fits into a rate-focused portfolio.
HBT Financial’s expansion story, with Q2 2026 net income of US$27.84 million and a higher P/E than many US banks, hints at something investors may be overlooking in this rate backdrop. For a fuller view of the risk reward angle, see the 3 key rewards and 1 important warning sign.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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