Bank stocks are starting to come back in a big way, quietly climbing as the overall market gets close to new record highs. On a recent episode of CNBC’s Fast Money, the panelists pointed out that big names like Goldman Sachs and JPMorgan Chase have recently hit all-time highs. That’s thanks to solid earnings, a more favorable interest rate outlook, and growing confidence in the markets. But while these large banks are grabbing headlines, the Fast Money panelists believe there may be even better opportunities in smaller banks that are still trading below their book value.
One example they mentioned is Citigroup, which is trading well below what its assets are worth, even though the company’s performance is improving. At the same time, many regional and mid-sized banks haven’t recovered fully since 2021, with some still down more than 25% from their peak. This shows a split in the market; big banks are doing great, but smaller ones are being left behind. That gap may not last, especially as money starts flowing back into these undervalued stocks. With better economic data and hints of looser banking rules, the stage could be set for a broader rebound. This article highlights 10 best bank stocks trading under book value that could offer strong returns over time.
A banker closely examining a document while seated at his desk.
Our Methodology
To identify the 10 best bank stocks trading under book value, we used Finviz’s screener to weed out non-banking stocks and those trading above their book value. Within the screened stocks, we sorted the list by market cap to prioritize the bigger banks and arrive at the list of 10 stocks. Finally, we organized the list in ascending order of hedge fund interest as of Q1 2025.
Note: All data was recorded on July 28, 2025.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10 Best Bank Stocks to Buy Trading Under Book Value
10. Deutsche Bank AG (NYSE:DB)
Price-to-Book Ratio: 0.83x
Market Cap: $63.38 billion
Number of Hedge Fund Holders: 17
Deutsche Bank AG (NYSE:DB) is one of the best bank stocks to buy trading under book value. Deutsche Bank (NYSE: DB), Germany’s largest lender, was downgraded by research firm Oddo BHF on July 25, moving its rating from “Outperform” to “Neutral.” Along with the downgrade, the firm set a new price target of €29, which is about $31.50 in U.S. dollars. This change signals a more cautious outlook from analysts, suggesting that while the bank may still perform steadily, significant near-term upside could be limited.
Despite the downgrade, Deutsche Bank has shown signs of progress in recent quarters. The company has continued to improve its balance sheet, cut costs, and grow profitability after years of restructuring and underperformance. It has also benefited from higher interest rates, which tend to support bank earnings by boosting net interest margins. Furthermore, the bank’s strong presence across investment banking, corporate lending, and asset management gives it a diversified revenue base that helps it weather volatility in any single segment. The shift in analyst opinion may simply reflect the stock’s recent gains and a more balanced risk-reward profile going forward.
9. United Bankshares, Inc. (NASDAQ:UBSI)
Price-to-Book Ratio: 0.97x
Market Cap: $5.22 billion
Number of Hedge Fund Holders: 22
United Bankshares, Inc. (NASDAQ:UBSI) is one of the best bank stocks to buy trading under book value. United Bankshares, Inc. (NASDAQ:UBSI) posted record earnings for the second quarter of 2025 on July 24, delivering strong results that reflect the company’s smart expansion strategy and solid financial management. Total revenue, which includes both interest and noninterest income, came in at $452.6 million for the quarter, a 13.3% year-over-year growth. The bank earned a net income of $120.7 million, or $0.85 per diluted share, which represented a 25.4% year-over-year growth.
Key performance metrics showed solid momentum. Return on average assets reached 1.49%, while return on average equity hit 9.05%, and return on tangible equity climbed to 14.67%. These improvements were largely driven by strong loan growth, higher interest income, and continued benefits from the Piedmont Bancorp acquisition. Net interest income rose to $274.5 million, up 6% from the previous quarter, and the bank’s net interest margin improved to 3.81%.
The bank also did a good job managing expenses. Merger-related costs dropped significantly, helping noninterest expenses fall by $5.6 million compared to the first quarter. Asset quality stayed healthy, with nonperforming loans at just 0.28% of the total loan book. With strong fundamentals, improved efficiency, and growth in new markets like Atlanta, United Bankshares appears to be in a solid position heading into the rest of the year.
