In the banking sector, "surprise" is a synonym for "failure." If you are waiting for the quarterly earnings report to understand your risk exposure, you are already six months behind the reality of your portfolio.

At Fitzgerald Advisors, we do not rely on headlines. We rely on the raw data buried in the footnotes of FDIC Call Reports and NCUA filings. We track the subtle vibrations in the balance sheet—the liquidity signals that precede a market correction.

There are three specific indicators we are monitoring right now. These are the smoke signals of the 2026 credit cycle.

1. The NPL Drift (Non-Performing Loan Migration)

Most institutions track "Charge-Offs." That is a lagging indicator. By the time a loan is charged off, the capital is already gone. The superior metric is NPL Drift.

We analyze the migration velocity of accounts moving from "30 Days Past Due" to "90+ Days." When this velocity increases—even by fractional percentages—it signals a structural weakness in the borrower base that credit scores haven't caught yet.

2. FDIC Call Report Forensics

The FDIC Call Report is the DNA of a bank's health, but few know how to read the genetic code. We strip-mine these reports to isolate Capital Efficiency Ratios that standard audits miss.

Key Metrics We Track:

• Texas Ratio Sensitivity: Measuring credit troubles relative to capital ability to absorb them.
• Efficiency Ratio Creep: Identifying when operational bloat is masking deteriorating net interest margins.
• Loan-to-Deposit Strain: The liquidity trap where lending obligations outpace stable funding sources.

3. Balance Sheet Stress Testing

A static balance sheet is a lie. A balance sheet only tells the truth when you apply pressure.

We execute Scenario-Based Stress Testing. We ask the uncomfortable questions: "What happens to your capital adequacy ratio if commercial real estate values drop another 15%?" "What is your liquidity runway if auto loan severities increase by 20%?"

This is not about pessimism; it is about preparedness. By stress-testing the portfolio against specific 2025/2026 recession scenarios, we help institutions identify which assets to hold, and which assets to liquidate immediately.

The Mandate

Risk is not static. It is a living, breathing entity. If you are operating on data from the last quarter, you are navigating the future with a map from the past.

We provide the real-time intelligence required to pivot your institution from "Exposure" to "Fortress."