Heritage Bank Named Top Bank for Credit Quality by Forbes in 2026

SAN JOSE, CA – February 10, 2026 – Heritage Bank of Commerce has been recognized as one of the nation's top financial institutions, earning a coveted spot on Forbes' 2026 list of America's Best Banks. The San Jose-based bank distinguished itself by securing the No. 1 ranking for credit quality, a critical measure of financial health and prudent risk management.

This accolade, part of Forbes' seventeenth annual ranking, places Heritage among the elite of the 200 largest publicly traded U.S. banks and thrifts. The recognition highlights the bank's consistent performance and stability in a dynamic economic landscape.

“Being recognized by Forbes once again reflects our steadfast commitment to excellence and our dedication to providing exceptional client service,” said Clay Jones, President of Heritage Bank of Commerce, in a statement. “We are honored by this recognition and remain focused on supporting the success of our clients and their businesses, helping to elevate the communities where we live and work.”

The Anatomy of a Top Performer

Forbes' rigorous evaluation process, which uses data provided by S&P Global Market Intelligence, analyzes banks across 11 equally-weighted metrics. These criteria scrutinize growth, profitability, and, most notably for Heritage Bank, credit quality. Key indicators include net interest margin, return on average assets, and efficiency ratios.

The bank's top ranking in credit quality is directly tied to its exceptionally low percentage of nonperforming assets relative to its total assets. Financial reports from the third quarter of 2025 show the bank's nonperforming assets to total assets ratio stood at a mere 0.07%, a figure that underscores a disciplined underwriting and loan monitoring process. This prudent approach is a cornerstone of the bank's strategy, contributing to its long-term stability.

Recent financial results further validate this strong standing. For the full year 2025, Heritage Commerce Corp (NASDAQ: HTBK), the bank's holding company, reported a 14.91% increase in revenue to $195.65 million. Adjusted net income for the year reached $56.4 million, with the bank's net interest margin expanding to 3.56%. This financial strength was also recognized in May 2025 by Kroll Bond Rating Agency (KBRA), which affirmed stable long-term ratings for the company, citing its disciplined liquidity, capital management, and robust credit quality.

Balancing National Acclaim with Local Roots

While its financial metrics earn national praise, Heritage Bank of Commerce maintains a deep focus on its Northern California communities. Operating 17 full-service branches from San Francisco to Hollister, the institution has successfully paired its high-performance banking engine with a community-centric service model.

This commitment to customer experience is not a new development. In 2024, the bank was named one of Forbes' World’s Best Banks, ranking 10th in the United States. That recognition was based on extensive consumer surveys evaluating trust, customer service, and the quality of financial advice—a testament to its client-first philosophy.

Beyond its branch services, the bank's community impact is substantial. In 2023 alone, Heritage donated $750,000 to over 380 non-profit organizations, and its employees dedicated more than 2,550 hours to volunteering. The institution also champions financial literacy and hosts “Small Business Toolbox Events” aimed at supporting minority-owned businesses in the Bay Area. This deep community integration, underscored by an A+ rating from the Better Business Bureau, illustrates a successful formula for how a regional bank can serve local needs while achieving elite national status.

A Case Study in Regional Banking Resilience

Heritage Bank's success story unfolds against the backdrop of a resurgent regional banking sector. After a period of volatility in 2023, regional banks as a group demonstrated remarkable strength in 2025, generating a year-to-date return of 19.2% and outperforming both the broader financial sector and the S&P 500. This trend reflects renewed investor confidence, stabilizing funding costs, and resilient economic activity.

Forbes' list itself often showcases the strengths of regional institutions like Heritage, which can leverage local market knowledge and operational efficiency to compete effectively against larger money center banks. Heritage's achievement serves as a case study in how strategic differentiation and a focus on fundamental banking principles—strong credit, efficient operations, and customer loyalty—can create a durable and successful franchise.

Investor Perspective and Market Realities

Despite the glowing operational results and prestigious accolades, the market's reception of Heritage Commerce Corp's stock has been more measured. The consensus rating from Wall Street analysts is currently a “Hold,” with several firms issuing downgrades in recent months. The average 12-month price target suggests a potential downside from its current trading level, reflecting a cautious outlook from some market observers.

However, this analyst sentiment is contrasted by other positive indicators. Institutional ownership in the company is high, at over 81%, suggesting strong confidence from large, long-term investors. Furthermore, short interest in the stock recently decreased, a potential sign of waning bearish sentiment. The company’s valuation, with a price-to-earnings ratio below the market average, may also appeal to value-oriented investors.

Perhaps the most telling sign of internal confidence is the bank's consistent dividend policy. The company has paid a cash dividend every quarter since 2013, recently declaring another $0.13 per share payable in February 2026. This reliable return of capital to shareholders underscores management's belief in the bank's sustained profitability and robust financial position, even as the market works to fully price in its award-winning performance.