Third Coast Bancshares, Inc. (TCBX): PESTLE Analysis [Nov-2025 Updated]

You need a clear, actionable breakdown of the forces shaping Third Coast Bancshares, Inc. (TCBX) right now. The near-term outlook for regional banks is defined by tighter capital rules and the sustained high-rate environment, which creates both a margin opportunity and a credit risk. For TCBX specifically, the balance is tricky: while the strong Texas economy drives loan demand, recessionary fears are defintely raising loan loss provisions for their commercial real estate (CRE) portfolio. We're looking at an estimated 2025 Net Income of around $45.0 million, but that number is highly sensitive to how they manage rising compliance costs, mandatory core system upgrades, and the growing pressure for climate-related financial disclosures. This PESTLE breakdown shows you exactly where the leverage points-and the risks-are.

Third Coast Bancshares, Inc. (TCBX) - PESTLE Analysis: Political factors

Increased regulatory scrutiny from the Federal Reserve and FDIC.

You've seen the headlines: bank regulation is tightening, and even smaller regional players like Third Coast Bancshares are feeling the heat. The Federal Reserve, which is the primary federal regulator for Third Coast Bank, is focusing heavily on third-party risk management. This isn't just paperwork; the Federal Reserve and FDIC have issued enforcement actions against financial institutions for lapses in overseeing their third-party service providers. For a bank with gross loans of $4.17 billion as of September 30, 2025, this translates directly into higher compliance costs and a need for robust, integrated risk management systems.

Separately, the FDIC's 2025 Risk Review highlighted increasing commercial credit risk, specifically citing pockets of stress in the Commercial Real Estate (CRE) sector. Third Coast Bancshares is proactively managing this, evidenced by the $200 million commercial real estate loan securitization completed in April 2025, a move designed to reduce risk-weighted assets and improve capital ratios.

Potential for new capital requirements (e.g., Basel III Endgame) impacting liquidity.

The Basel III Endgame proposal, which overhauls the calculation of risk-weighted assets (RWA), remains a major political and regulatory discussion point, even if its direct impact on Third Coast Bancshares is limited. The most stringent parts of the proposal apply to banking organizations with $100 billion or more in total consolidated assets. Given that Third Coast Bancshares reported total assets of $5.06 billion as of September 30, 2025, the bank is likely exempt from the most onerous new requirements. Still, the overall regulatory environment is shifting.

The original proposal suggested a potential 10% increase in capital requirements for regional banks, and while a reproposal is expected to largely exempt domestic regional and community banks, the final rule is not expected to be finalized until the second half of 2025, with a proposed implementation start of July 1, 2025. This uncertainty still forces banks to hold more capital defensively. It's a classic case of the largest banks setting the tone for everyone else.

Geopolitical stability affecting energy sector clients in the Texas market.

Third Coast Bancshares is heavily concentrated in the Texas market, including Houston, Dallas-Fort Worth, and Austin, which ties its fortunes to the state's dominant energy sector. Geopolitical tensions-like those causing disruptions in the Red Sea or new Russia-related sanctions-are cited as increasing commercial credit risk and creating downside uncertainty.

The Dallas Fed Energy Survey in Q2 2025 showed a tangible impact: the business activity index for the Eleventh District turned negative, declining from 3.8 in Q1 2025 to -8.1 in Q2 2025. The oil production index also fell sharply from 5.6 to -8.9 over the same period. This slight contraction in activity, coupled with an expected year-end 2025 West Texas Intermediate (WTI) oil price of around $68 per barrel, means a portion of the bank's Commercial & Industrial (C&I) loan portfolio faces elevated market volatility risk.

However, there's a huge opportunity in Texas's energy transition. Data centers and cryptocurrency mining are projected to increase the Electric Reliability Council of Texas (ERCOT) load demand by 60% in 2025, representing 10% of the total load. This surge in demand creates a need for substantial infrastructure financing, a clear lending opportunity for a Texas-focused bank.

Shifting federal tax policies influencing corporate and individual banking demand.

The passage of the 'One Big Beautiful Bill Act' (OBBBA) in July 2025 solidified the near-term tax landscape, making many provisions of the 2017 Tax Cuts and Jobs Act (TCJA) permanent. For corporate clients, the statutory corporate tax rate remains at 21%, but new business-friendly provisions could drive the effective rate for some companies as low as 12%. This lower tax burden could spur capital spending and business expansion, increasing demand for commercial loans.

A major, direct benefit for Third Coast Bancshares is a new, permanent tax provision allowing a 25% gross income exclusion on interest income from qualified rural or agricultural real estate loans originated after July 4, 2025. That's a defintely a powerful incentive for the bank to lean into its regional agricultural lending business.

2025 Federal Tax Policy Change	Key Metric/Value	Impact on TCBX Clients/Demand
Corporate Tax Rate (Statutory)	Remains at 21%	Stability for C-Corp clients; supports capital planning.
Rural/Agricultural Loan Interest Exclusion	25% gross income exclusion (permanent, post-July 4, 2025)	Directly incentivizes TCBX to grow its rural/agri real estate loan portfolio.
Qualified Business Income Deduction (QBID) Expiration	Scheduled to expire end of 2025; top tax rate on pass-through income rises from 29.6% to 39.6%	Increases tax burden for S-Corp and partnership clients, potentially dampening small business investment and loan demand.

Third Coast Bancshares, Inc. (TCBX) - PESTLE Analysis: Economic factors

Sustained higher interest rates boosting Net Interest Margin (NIM) but increasing funding costs

The prolonged period of elevated interest rates presents a classic double-edged sword for Third Coast Bancshares, Inc. (TCBX). On one hand, the higher rate environment has significantly boosted the company's Net Interest Margin (NIM)-the difference between interest income and interest paid to depositors. TCBX's NIM expanded from 3.80% in Q1 2025 to a peak of 4.22% in Q2 2025, before a slight moderation to 4.10% in Q3 2025. This expansion is driven by a strong yield on loans, which reached 7.95% in Q2 2025.

However, this NIM expansion comes with the rising cost of funding. The cost of interest-bearing deposits, a key funding cost, remained relatively stable but high, at 4.02% in Q1 2025 and 4.00% in Q2 2025. The bank has been effective in managing this, with a drop in liability costs driving the NIM improvement, but any future Federal Reserve rate cuts could pressure the NIM, as markets anticipate another 1% in rate cuts over the next year.

Recessionary fears raising loan loss provisions for commercial real estate (CRE) portfolio

Despite the strong Texas economy, broader recessionary fears, particularly concerning the commercial real estate (CRE) sector, are forcing TCBX to maintain a disciplined approach to credit risk. This is visible in the bank's provision for credit losses, which stood at $2.1 million in Q2 2025, reflecting a 12% year-over-year increase.

The bank is actively managing its CRE exposure, a prudent move given the national rise in CRE delinquency. TCBX completed two major CRE loan securitizations in the first half of 2025 to mitigate risk and manage capital concentration:

• A $200 million revolving commercial real estate loan securitization in Q1 2025.
• An additional $150 million CRE loan securitization in Q2 2025.

These actions reduce the bank's risk-weighted assets and decrease its construction and land development loan concentrations, which is defintely a smart defensive strategy.

Strong economic growth in core Texas markets (Houston, Austin) driving loan demand

The economic vitality of TCBX's core markets in Texas provides a robust foundation for loan growth, offsetting national economic slowdowns. The Texas economy continues to outperform the national average, having expanded by 3.9% in 2024. This strong regional performance is a direct driver of the bank's lending opportunities, particularly in commercial and industrial (C&I) loans.

The 2025 GDP growth forecasts for the bank's key metropolitan areas are compelling:

• Austin is forecasted to have a GDP growth of 4.3%, ranking it No. 1 among major U.S. cities.
• Houston is forecasted to see GDP growth of 2.2%, outpacing the national average of 1.9%.

This environment supports the bank's ambitious 2025 loan growth target of $325 million, which translates to an 8% annual run rate. Gross loans increased to $4.17 billion as of September 30, 2025, up from $4.08 billion in Q2 2025.

Estimated 2025 Net Income of around $45.0 million, a key metric for valuation

TCBX's strong performance through the first three quarters of 2025 has already surpassed the initial conservative annual Net Income estimates. The combined Net Income for Q1, Q2, and Q3 2025 totaled $48.4 million, which is already well above the $45.0 million figure often cited as a conservative annual target. This over-performance is a critical metric for investor valuation, particularly the attractive P/E ratio of 10.56x as of Q3 2025.

Here's the quick math on the year-to-date (YTD) performance, showing the clear upward trajectory:

Metric	Q1 2025	Q2 2025	Q3 2025	Q1-Q3 2025 Total
Net Income	$13.6 million	$16.7 million	$18.1 million	$48.4 million
Net Interest Margin (NIM)	3.80%	4.22%	4.10%	N/A

Based on the Q3 Net Income run rate of $18.1 million, a full-year 2025 Net Income projection would be approximately $66.5 million ($48.4 million YTD + $18.1 million Q4 estimate), demonstrating significant profitability expansion. What this estimate hides is the potential for Q4 seasonality or the impact of the recent Keystone Bancshares acquisition announced in Q3 2025, which is expected to be accretive to earnings in the long run.

Third Coast Bancshares, Inc. (TCBX) - PESTLE Analysis: Social factors

Growing demand for personalized, defintely digital-first banking services from younger customers.

The shift toward digital-first banking is not a future trend; it is the current reality, especially for the younger generations who are now gaining economic power. For Third Coast Bancshares, Inc. (TCBX), a commercially focused regional bank, this means a significant challenge to its traditional relationship-banking model. Data shows a staggering 89% of Gen Z (ages 13-27 in 2025) interact with their bank via smartphone apps, often bypassing desktop platforms entirely.

This demographic demands instant, personalized service, with an estimated 42.9 million Gen Zers expected to use mobile banking in the U.S. and Canada by the end of 2025. For TCBX, the risk is clear: only 32% of its customer base consists of Millennials or Gen Zers, compared to 50% for larger megabanks. Digital account openings by Gen Z increased by 42% from 2024 to 2025, so if your digital onboarding isn't seamless, you're losing the next generation of deposits.

• 70% of Gen Z cite mobile apps as their primary access point.
• 92% of Gen Z prefer using mobile apps over visiting a branch.
• The average Gen Z user logs into their mobile app 21 times per month.

Demographic shifts in Texas (inward migration) increasing the retail customer base.

The massive demographic boom in Texas presents a clear, immediate opportunity for TCBX, whose 19 branches are strategically located across the Greater Houston, Dallas-Fort Worth, and Austin-San Antonio markets. The state's population surpassed 31 million people, with Texas adding 562,941 residents between July 2023 and July 2024-the largest numerical increase in the country.

This growth is fueled by migration, which directly increases the potential retail customer base for deposits and loans across TCBX's footprint. While domestic migration is slowing, net international migration is picking up the slack, adding 319,569 new residents from abroad in that same period. This influx means a constant stream of new households needing checking accounts, mortgages, and small business loans, especially in the metropolitan areas where TCBX operates.

Focus on local community support and corporate social responsibility (CSR) for reputation.

In a market dominated by large national banks, TCBX's reputation as a community-focused institution is a key competitive differentiator. Community Reinvestment Act (CRA) performance is the formal metric here, and TCBX holds a 'Satisfactory' CRA rating from its most recent assessment, which is the baseline expectation.

More specifically, the bank's willingness to lend locally is quantified by its 13-quarter average Net Loan-to-Deposit (NLTD) ratio, which stood at 94.6% as of December 31, 2021. This ratio is considered more than reasonable and demonstrates a strong commitment to deploying deposits back into the local community. Beyond lending, TCBX actively promotes its 'Culture Counts' and 'Sustainable Habits' initiatives, including an annual tree planting campaign that has planted over one acre of new trees across Texas forests since 2022.

Community/Social Metric	TCBX Performance/Context	Date/Period
CRA Rating (Most Recent)	Satisfactory	April 2022
Net Loan-to-Deposit (NLTD) Ratio	94.6% (considered more than reasonable)	13-Quarter Average (ending Dec 31, 2021)
Environmental/CSR Impact	Planted over one acre of new trees in Texas forests	Since 2022

Talent wars for skilled technology and compliance professionals in the Houston area.

The demand for specialized talent, particularly in financial technology (FinTech) and regulatory compliance, is a significant operational challenge for all Texas banks. The national 'Compliance Talent Crisis' is acute: 43% of global banks report regulatory work going undone due to staffing gaps, and the average vacancy duration for senior compliance roles is 18 months.

For TCBX, maintaining a lean and efficient structure is critical, as shown by its improved efficiency ratio of 53.03% in the third quarter of 2025, down from 55.45% in the prior quarter. However, this efficiency is constantly threatened by the need to hire top-tier talent to manage a growing balance sheet, which saw gross loans increase to $4.17 billion as of September 30, 2025. The bank's total employee count only increased slightly, from 388 to 398, between Q2 and Q3 2025, suggesting a high premium on each new hire's productivity and expertise. Fintechs complicate this, often paying $350K base salaries for a 5-year experienced Anti-Money Laundering (AML) analyst.

Third Coast Bancshares, Inc. (TCBX) - PESTLE Analysis: Technological factors

You're a regional bank, Third Coast Bancshares, Inc., operating in high-growth, tech-savvy markets like Austin, Texas. That means your technology is not just a cost center anymore; it's the main battleground. Your core challenge is translating massive industry-wide tech spending into a competitive advantage without crippling your operating margin. We need to focus on where the $73 billion in projected 2025 banking AI spend is going, and how you can get a return on that kind of investment.

Mandatory investment in core system upgrades to improve efficiency and reduce operational risk.

Honestly, your legacy core banking system (if it's like the 90% of US banking core software still in use) is a ticking time bomb, not just a slow one. These outdated systems consume up to 75% of a bank's total IT budget just for maintenance, which severely limits your capacity for innovation. The cost of keeping the lights on is defintely higher than you think; banks consistently underestimate the true total cost of ownership (TCO) of these legacy platforms by 70-80%.

A full core system modernization isn't cheap, but the payoff is clear. Banks that have completed this transformation report slashing operational costs by 30-40% and boosting operational efficiency by 45% in the first year alone. For a bank of TCBX's size, this is a multi-million-dollar, multi-year project, but it's the only way to achieve the near-perfect service uptime of 99.99% that modern cloud-native architectures deliver.

Core System Modernization Impact	Legacy System Burden	Modern System Benefit (First Year)
IT Budget Consumption (Maintenance)	Up to 75% of IT budget	Significant reduction in operating costs (e.g., European bank saved 38% in 18 months)
Operational Efficiency	Limited scalability, high manual error rate	Up to 45% boost in efficiency
Time-to-Market for New Products	Months or years	Up to 62% faster time-to-market

Rapid adoption of Artificial Intelligence (AI) for fraud detection and loan underwriting.

The race to adopt Artificial Intelligence (AI) is no longer optional for regional banks. The entire banking sector is projected to spend over $73 billion on AI technologies by the end of 2025, and your competitors are already deploying it in core functions. For TCBX, AI offers a dual-benefit: better risk management and faster revenue generation.

Here's the quick math on why this investment matters:

• Fraud Detection: AI-based systems are reducing false fraud alerts by up to 80% in major U.S. banks. This cuts down on customer friction and operational overhead from investigating false positives.
• Loan Underwriting: AI-driven credit risk modeling has improved loan approval accuracy by 34% in mid-size banks, plus it reduces the manual intervention in underwriting by up to 90%. This means faster loan decisions for your commercial clients, which is a huge competitive edge in the Texas market.

Competition from large national banks and fintechs demanding better mobile user experience.

Your customers compare your mobile app not to other regional banks, but to the best digital experiences they use every day, like Amazon and Netflix. FinTechs and large national banks are setting a high bar with seamless, integrated, and personalized mobile User Experiences (UX). The competitive edge now lies in delivering a fully integrated, end-to-end journey.

The key mobile UX features that are now table stakes in 2025 include:

• Biometric security (fingerprint/facial recognition) to replace passwords.
• Voice-driven commands for simple transactions (e.g., check my balance).
• Data-driven personalization that tailors dashboards and alerts.

If your mobile onboarding process takes 14+ days, or if the app is clunky, churn risk rises dramatically, especially since Neobanks can attract customers for just $5-$15 per customer, compared to the $150-$350 cost for traditional banks.

Cybersecurity spending is a non-negotiable, rising cost center every year.

Cybersecurity is no longer just an IT issue; it's a top-tier enterprise risk, and the cost of defense is escalating. Following multiple data breaches in 2024, 88% of U.S. bank executives plan to increase their IT and tech spend in 2025 by at least 10%, with cybersecurity being the biggest area of budget increases. The Securities and Exchange Commission (SEC) is also focusing on AI-based cybersecurity risks in its FY 2026 examination priorities, so regulatory pressure is high.

For TCBX, a regional bank, cybersecurity spending is a non-negotiable rising cost center. The average cost of a data breach in the financial sector is about $5.90 million, which is 28% higher than the global average. This reality forces a continuous, significant allocation of capital to defenses like advanced firewalls, AI-driven threat intelligence, and third-party risk management, just to maintain operational resilience and compliance. You simply have to spend more to stay in the game.

Third Coast Bancshares, Inc. (TCBX) - PESTLE Analysis: Legal factors

Stricter enforcement of Bank Secrecy Act (BSA) and Anti-Money Laundering (AML) compliance.

You need to assume that the cost of compliance for the Bank Secrecy Act (BSA) and Anti-Money Laundering (AML) is not a fixed cost anymore; it's a rising operational risk, defintely for a regional bank like Third Coast Bancshares, Inc. (TCBX). Regulators are not just targeting the mega-banks; they are increasingly focused on smaller institutions, which often have fewer resources to manage complex compliance systems.

In 2024, federal agencies issued 42 BSA/AML-related enforcement actions, a significant jump from 29 in 2023. More critically for TCBX's peer group, 54% of those actions against banks were issued to institutions with asset sizes under $1 billion. This means the regulatory microscope is squarely on regional players. The penalties are massive, too: the total financial penalties for BSA noncompliance in 2024 amounted to approximately $3.3 billion, following $3.96 billion in 2023. The message is clear: weak internal controls will cost you billions, not millions, in the most egregious cases, like the $3.09 billion fine levied against TD Bank for systemic failures.

Your action here is to increase investment in automated transaction monitoring and customer due diligence (CDD) technology. It's cheaper to prevent a violation than to pay a fine and hire a third-party monitor.

• Increase BSA/AML tech budget by 15% in FY2025.
• Prioritize suspicious activity report (SAR) filing accuracy.
• Compliance is now a revenue-protection function.

New state-level data privacy laws (like Texas's) requiring costly system overhauls.

While the Gramm-Leach-Bliley Act (GLBA) provides some federal preemption for financial institutions, the Texas Data Privacy and Security Act (TDPSA), effective July 2024, still creates compliance headaches, especially around consumer data rights. The biggest near-term challenge for TCBX is the universal opt-out mechanism requirement, which went into effect on January 1, 2025. This forces a costly system overhaul to recognize and comply with global privacy signals from a user's browser or device, even for non-GLBA-covered data processing like marketing analytics.

The law grants Texas residents the right to access, correct, delete, and port their personal data, plus the right to opt-out of targeted advertising, data sale, or profiling. You must be ready to respond to these requests within 45 days. The Texas Attorney General is the sole enforcer, with civil penalties of up to $7,500 per violation. Even though the GLBA exempts much of the core banking data, TCBX's marketing and digital operations are likely exposed, forcing an expensive, bank-wide data mapping project.

Consumer Financial Protection Bureau (CFPB) rules on overdraft and late fees tightening margins.

The regulatory environment around consumer fees remains volatile, but you got a temporary reprieve. The CFPB's final rule, which would have capped overdraft fees at a benchmark of $5 for banks with over $10 billion in assets, was set to take effect in October 2025. However, Congress overturned this rule in September 2025 using the Congressional Review Act. So, the immediate, drastic cut to fee income is off the table for now.

Still, you can't ignore the trend. Banks have already reduced revenue from overdraft and non-sufficient fund (NSF) fees by nearly 50% from 2020 to 2023, driven by market pressure and previous regulatory actions. The CFPB's focus on 'junk fees' is a long-term threat. TCBX must continue to diversify its non-interest income away from reliance on these fees, as the political and market pressure to lower them will not disappear.

Fee Type	Pre-Rule Average (2024)	CFPB Rule Cap (Overturned)	Near-Term Impact (Post-Overturn)
Overdraft Fee	$27.08	$5.00	Market pressure continues to drive voluntary reductions.
Annual Consumer Savings (Projected by CFPB)	N/A	Up to $5 Billion	Savings potential remains a political target.

Litigation risk tied to commercial loan defaults in a slowing economy.

The most significant legal risk for TCBX in 2025 is the looming litigation wave from Commercial Real Estate (CRE) loan defaults. Regional banks are disproportionately exposed to this sector, with CRE debt constituting approximately 44% of total loans, compared to just 13% for larger banks.

The problem is the sheer volume of debt maturing at higher interest rates: over $1 trillion in CRE loans are slated to mature by the end of 2025. The delinquency rate on CRE loans across all commercial banks hit 1.57% in Q4 2024, a notable increase from 1.17% in Q4 2023. Office properties are the worst segment, with delinquency rates surging to 10.4%. Litigation from these defaults-foreclosures, borrower bankruptcies, and disputes over loan covenants-will spike TCBX's legal expenses and loan loss provisions in the 2025 fiscal year.

You need to be proactive. Litigation risk is high when loans reset. Your legal team must work with the workout group now.

• CRE exposure is 44% of regional bank total loans.
• Office loan delinquency rate reached 10.4%.
• Over $1 trillion in CRE loans mature by end of 2025.

Third Coast Bancshares, Inc. (TCBX) - PESTLE Analysis: Environmental factors

Emerging pressure from investors and regulators for climate-related financial risk disclosures.

You are defintely seeing the screws tighten from both investors and regulators on climate risk, and Third Coast Bancshares, Inc. (TCBX) is not immune, even as a regional bank. Major asset managers like BlackRock are demanding transparency on how climate change impacts a bank's balance sheet, pushing the issue beyond just public relations into core financial reporting.

TCBX has already started this journey by committing to the World Economic Forum's (WEF) Stakeholder Capitalism Metrics (SCM) and providing baseline disclosures on 21 core metrics. This is a smart, preemptive move. The next phase will require translating general climate risks-like the physical damage of a hurricane-into specific, quantifiable financial impacts on your $4.17 billion gross loan portfolio as of September 30, 2025.

Increased due diligence on lending to high-emission sectors like oil and gas.

This is where TCBX has a distinct, structural advantage over many of its Texas peers. While the Texas economy is heavily influenced by the energy sector, TCBX carries no oil and gas exposure in its loan book. This zero-exposure profile immediately de-risks the bank from a major source of transition risk-the financial fallout from a global shift away from fossil fuels.

To give you a comparison, some regional competitors are still carrying significant exposure, like Cullen/Frost at 5.4% and Southside Bank at 1.2% of their respective loan portfolios. Your due diligence on this sector is essentially complete: you avoid the risk entirely. The challenge is maintaining this position while operating in a state where the energy industry remains a primary economic driver.

Need to assess physical risk (e.g., hurricane exposure in the Gulf Coast) on collateral value.

Physical risk is the most immediate and quantifiable environmental threat to TCBX's commercial real estate (CRE) collateral across the Gulf Coast and Texas metropolitan areas. The sheer scale of recent events makes this clear. For instance, the deadly Central Texas flash floods in July 2025 resulted in an estimated $18 billion to $22 billion in total damage and economic loss.

This risk directly impacts the value of the property securing your loans. TCBX has proactively addressed this concentration risk by executing two major commercial real estate loan securitizations in the second quarter of 2025, totaling $100 million and $150 million. This is a capital-management action that directly mitigates the risk of a single catastrophic weather event eroding a large portion of your balance sheet.

Texas Weather Event (2024-2025)	Estimated Total Damage/Economic Loss	TCBX Risk Mitigation Action (2025)
Hurricane Beryl (July 2024, Category 1)	Preliminary $1.5 billion in Texas	Completed $100 million CRE Securitization (Q2 2025)
Central Texas Flash Floods (July 2025)	$18 billion to $22 billion	Completed $150 million CRE Securitization (Q2 2025)

Green lending opportunities for commercial solar or energy efficiency projects.

The transition to a lower-carbon economy in Texas presents a massive, near-term lending opportunity, especially in commercial real estate. Commercial-scale solar capacity in Texas is projected to triple by 2030. You need to capture a piece of this market.

The economics for your commercial clients are compelling in 2025 due to federal incentives. A commercial project can qualify for the 30% federal Investment Tax Credit (ITC), plus the benefit of 80% bonus depreciation. This combination creates an attractive return on investment and a strong credit profile for a dedicated green lending product.

Clear Action: Launch a targeted 'Green CRE' loan product by Q1 2026. This product should focus on financing commercial solar and energy efficiency upgrades for your existing CRE clients, leveraging the following incentives:

• Offer financing for the 30% Investment Tax Credit (ITC).
• Structure loans to maximize the 80% bonus depreciation benefit.
• Target high-energy-cost sectors like manufacturing and retail centers.

This is a clear path to generating high-quality commercial and industrial (C&I) loans, which currently make up a large portion of your loan book, while simultaneously supporting your clients' energy cost stability.