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The U.S. Regional Bank Stock ETF is recovering from its plunge in early 2023, posting its biggest monthly gain since 2016 in July.

U.S. regional bank stocks are recovering from their plunge in early 2023, with the KBW Nasdaq Regional Banks Index up 18% in July, which it the best month in performance since November 2016.

In early 2023, regional bank stocks were hit hard after the sudden collapse of Silicon Valley Bank. The collapse sparked fears of a potential bank run elsewhere in the regional banking system. In order to ease the concern, the Federal Reserve adopted an emergency lending program in March to dispel those fears.

The Fed's program boosted confidence by providing additional funds to ensure that banks could meet the needs of all depositors. $SPDR S&P Regional Banking ETF(KRE)$ fell nearly 29% in March and continued to slide over the next two months before rebounding in June.

The economic recovery gained momentum in July after banks reported their latest quarterly earnings this month; and the $S&P 500(.SPX)$ enjoyed the positive uptrend momentum with strong economy growth.

Meanwhile, ETFs in the regional banks have also risen. For instance, the $SPDR S&P Regional Banking ETF(KRE)$ has been the biggest beneficiary, soaring nearly 19%. the $Invesco KBW Regional Banking ETF(KBWR)$ and $iShares US Regional Banks ETF(IAT)$ were up 18% and 15%, respectively.

According to the data, so far in 2023, the SPDR S&P Regional Banking ETF (KRE) was down 17%, the iShares U.S. Regional Banks ETF (IAT) and the Invesco KBW Regional Banking ETF (KBWR) are down 18% and 9% respectively.

The S&P 500 SPX was up 3.11% in July, 17% year-to-date.

We analyzed the above ETFs as follows:

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SPDR S&P Regional Banking ETF(KRE） $SPDR S&P Regional Banking ETF(KRE)$

The SPDR S&P Regional Banking ETF provides exposure to the regional banking sector by tracking the S&P Regional Banks Select Industry Index. It holds 139 stocks in the basket, each representing no more than 2.3% of assets.

The SPDR S&P Regional Banking ETF has $3.6 billion in assets under management with annual fee of 35 basic points. It has an average daily trading volume of 20.3 million shares.    

Invesco KBW Regional Banking ETF (KBWR） $Invesco KBW Regional Banking ETF(KBWR)$

The Invesco KBW Regional Banking ETF provides exposure to publicly traded regional banks and savings companies in U.S. by tracking the KBW Nasdaq Regional Banking Index. It holds 52 stocks in the basket, none of which represents more than 4.3% of assets.

The Invesco KBW Regional Banks ETF, a relatively less popular and illiquid option in this sector, has $65.1 million under management with an average daily trading volume of 15,000 shares. It charges investors 35 basis points per year.

iShares U.S. Regional Banks ETF(IAT） $iShares US Regional Banks ETF(IAT)$

The iShares U.S. Regional Banks ETF provides exposure to 35 small and middle regional bank stocks by tracking the Dow Jones U.S. Selected Regional Banks Index. It focuses on the top three companies with double-digit allocations (Reference: All Financial ETFs here).

The iShares US Regional Banks ETF has amassed an asset of $792.2 million and trades up to 688,000 shares per day. The product charges an annual fee of 40 basis points.

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