KRE vs. IAT vs. KBWB: Regional Bank ETF Holdings, Weighting, and Overlap

“Bank ETF” does not tell you which banks matter most in the fund. The index determines the eligible companies, how each company is classified, how shares are weighted, and when those weights are reset. Here, one fund spreads weight broadly across regional lenders, one is regionally screened but lets larger companies occupy more of the basket, and one reaches beyond regional banks into a broader selection of U.S. banking stocks.

The counts above are equity rows from the issuers’ dated files, not a claim that each ETF contains only stocks. The comparison uses the September 24, 2026 State Street KRE spreadsheet, iShares IAT CSV, and Invesco KBWB holdings feed. Fees and product details were checked on issuer pages September 26. See the KRE profile and portfolio, IAT profile and holdings, and KBWB product page.

KRE tracks the S&P Regional Banks Select Industry Index. S&P describes that index as a modified equal-weighted measure of regional-bank stocks drawn from its U.S. equity universe. “Modified” matters: index eligibility and portfolio rules still apply, so this is not a promise that every stock will have exactly the same weight every day. S&P’s methodology sets market-capitalization and liquidity screens, and the index is rebalanced quarterly. The current S&P index profile identifies its weighting method; the Select Industry methodology describes eligibility and maintenance.

The September file shows the effect of that construction. KRE’s ten largest direct-stock weights are each close to 1.1% of net assets. Its top ten sum to 11.239346%, rounded to 11.24%. A bank near the top of the file therefore does not overwhelm the basket in the way that a 10% or 15% position can in a market-cap-heavy fund. That spreads issuer-specific exposure, but it also means KRE gives more influence to many smaller banks, whose shares and businesses can have different liquidity and credit profiles from the largest U.S. banks.

The exact issuer file is State Street’s daily KRE holdings spreadsheet dated September 24, 2026. Its stock weights are percentages of fund net assets. It also lists a government money-market position and U.S. dollar cash, which are not counted as bank-stock holdings in this comparison.

IAT tracks the Dow Jones U.S. Select Regional Banks Index. The index starts from the Dow Jones U.S. Banks Index and applies a regional-bank asset screen: its definition excludes a bank when the bank’s three-year average total assets exceed 5% of the selection universe’s three-year average total assets. This is a defined index rule, not a guarantee that every company investors might call a “regional bank” will be included. The current S&P Dow Jones index methodology describes the universe, asset screen, and annual June reconstitution.

The same methodology says constituents are float-adjusted market-cap weighted subject to concentration limits. At rebalancing, one company is capped at 22.5%; the aggregate weight of companies above 4.5% is capped at 45%, with excess weight redistributed under the stated rules. Those are review-time constraints, not a guarantee that daily weights stay at the thresholds after prices move. The September 24 file illustrates the difference from KRE: U.S. Bancorp (USB) is 15.14%, PNC Financial Services (PNC) is 14.82%, and Truist Financial (TFC) is 9.59%. Together they make up 39.55% of IAT’s net assets.

IAT therefore holds a regional-screened basket whose largest positions are much larger than KRE’s individual weights. This is not a contradiction: the fund name describes the index’s target segment, while the index’s weighting method determines which eligible firms dominate the portfolio. The iShares IAT holdings CSV dated September 24, 2026 reports 30 equity rows and gives the weights used below.

A useful mental picture is three baskets with different construction rules: many similarly weighted small bank buildings in one, a few larger regional banks in another, and a mix of national and regional institutions in the third. The illustration is conceptual; it does not depict actual holdings or current portfolio weights.

KBWB tracks the KBW Nasdaq Bank Index, which Nasdaq describes as a selection of leading U.S.-traded banks and thrifts, including national money-center banks, regional banks, and thrifts. Nasdaq’s current BKX index page lists 24 components. Invesco’s KBWB profile states that the index is modified market-cap weighted and that the fund and index are rebalanced and reconstituted quarterly.

The Nasdaq KBW Nasdaq Bank Index methodology describes a two-stage quarterly weighting process. First, initial market-cap weights are adjusted so no security exceeds 8%. In the second stage, the first-stage weights of the five securities with the largest market capitalizations are retained; every other security is capped at 4%, with excess weight redistributed under the methodology. The result permits up to five weights above 4%, while no weight exceeds 8% at the review. Price moves afterward can take a holding beyond its review-time target, so the September snapshot is not a live view of the cap calculation.

KBWB is broader than a small- and mid-sized regional-bank sleeve. Its September 24 equity basket includes Wells Fargo (WFC), JPMorgan Chase (JPM), Morgan Stanley (MS), Bank of America (BAC), and Goldman Sachs (GS) among the largest positions, alongside regional banks. The Invesco holdings feed dated September 24, 2026 reports 24 rows identified as Common Stock. Its 31 total reported holdings also include money-market, cash, collateral, and futures-related lines; those are discussed separately rather than added to the equity count.

All three main holdings snapshots are dated September 24, 2026, so the pairwise overlap below is a same-day comparison. The fund sponsors use different file formats and different precision. KRE’s spreadsheet gives stock weights to six decimals of a percent; KBWB’s feed gives six decimals of a percent; IAT’s CSV publishes weights to two decimals of a percent. Results involving IAT are therefore approximate at the source’s displayed precision and are rounded to two decimal places.

For the three main funds, I count only direct equity holdings. KRE has 167 equity rows representing 99.712519% of net assets in the file, plus a government money-market holding at 0.131961% and U.S. dollar cash at 0.001461%. All 169 weighted KRE rows sum to 99.845941%, leaving 0.154059 percentage points of fund net assets not accounted for by a named row in the file. I do not assign that residual to a particular asset or attribute it to rounding. IAT has 30 equity rows representing 99.72% of net assets. Its CSV separately shows cash at 0.18%, a Treasury money-market fund at 0.10%, collateral at 0.02%, and an E-mini Financial Select Sector futures line with $1.694 million notional value but 0.00% market-value weight at the file’s displayed precision. KBWB has 24 Common Stock rows representing 99.502181% of net assets. Its other reported lines include a government money-market fund (AGPXX) at 0.481829%; an IXAZ6 E-mini Financial Select Sector future expiring December 18, 2026, at 0.157016% and with a $9,996,812.50 market value; cash collateral at 0.015289%; USD cash and equivalents at 0.000701%; an uninvestible-cash line with 0.00% weight and a $0.01 market value; contra synthetic cash at −0.157016% and −$9,996,812.50; and USD Pending Dividends with a $13,328,468.50 market value but no percentage weight shown. The future and contra line have equal and opposite reported weights; none of these lines is counted as a common-stock holding.

None of the three September files labels a preferred stock as one of the direct equity positions included in this calculation. I exclude money-market funds, cash, collateral, futures, uninvestible cash, pending dividends, and other non-common-stock lines, and I do not treat a futures notional value as a stock market value. IAT’s displayed weights are rounded to two decimal places, so its published lines may not sum exactly to 100%. The KRE file’s weighted rows sum to 99.845941%, leaving 0.154059 percentage points unaccounted for by a named line; no cause for that residual is shown in the file. For a broader explanation of why ETF holdings, index constituents, and creation baskets differ, see ETF holdings versus index constituents and creation baskets.

The table ranks each direct-stock portfolio by the issuer’s September 24 weight. Percentages use the fund’s total net assets as the denominator, not a renormalized stock-only subtotal. KRE’s ten rows are all around 1.1%; IAT’s largest three are far heavier; KBWB’s top five are close to the methodology’s review-time upper range.

A low top-ten percentage describes issuer concentration, not total risk. KRE’s 167 names can still respond to shared credit, deposit-funding, and regional-economy shocks. Conversely, a larger top-ten weight does not prove an ETF is less suitable for a particular investor. It only shows where the fund’s stock exposure is concentrated in this dated snapshot.

I matched common stocks using the exact issuer ticker shown in each holdings file. KRE and KBWB also provide CUSIPs, which I used to confirm that the displayed ticker rows refer to the same issuer; the IAT U.S. CSV identifies stocks by ticker. No ticker aliases were needed for these bank-stock matches.

For each fund pair, “A’s matched weight” is the sum of A’s published net-asset weights for names also present in B. “B’s matched weight” is the reverse. “Sum of lower matched weights” is the sum, name by name, of the lower of the two funds’ published weights. The first two figures answer how much of each fund is in common names; the last is a symmetric dollar-weight comparison if the same dollar amount were invested in each ETF. None measures return correlation, shared credit sensitivity, or diversification of an investor’s full account.

The asymmetry is informative. More than three quarters of IAT’s equity weight is in tickers KRE also owns, but those names account for only about 27.08% of KRE. IAT’s dominant USB, PNC, and TFC positions do not receive comparable weights in KRE, while KRE spreads more weight across smaller banks. IAT and KBWB share 14 names, and those common names represent about 40.11% of KBWB and 76.64% of IAT. KRE and KBWB share only 10, despite both being U.S. bank funds.

XLF tracks the Financial Select Sector Index within the S&P 500. State Street describes that index as covering financial services, insurance, banks, capital markets, mortgage REITs, and consumer finance. It is therefore a broader financial-sector basket rather than a regional-bank fund. The September 24 XLF file contains 76 direct equity rows; the XLF profile lists a 0.08% gross expense ratio, and the dated XLF holdings spreadsheet supports the stock-level comparison.

The five KRE/XLF matches are Citizens Financial (CFG), Huntington Bancshares (HBAN), M&T Bank (MTB), Regions Financial (RF), and Truist (TFC). KBWB has far more overlap with XLF because its bank index includes large money-center and other major financial institutions. These figures are direct-stock look-throughs, not a correlation study and not a measure of all indirect economic links between financial companies.

XLF’s September 24 file has 76 direct equity rows, representing 99.848653% of net assets. Other reported lines include U.S. dollar cash at 0.058266%, a government money-market position at 0.047672%, British-pound cash at 0.000001%, and an E-mini Financial Select Sector futures line at −0.006536%. These are separate reported lines; the futures and cash are not common-stock positions and are excluded from the ticker overlap. All 80 weighted lines sum to 99.948056%, leaving 0.051944 percentage points not accounted for by a named row in the workbook. I do not assign that residual to an asset or attribute it to rounding. No preferred stock is identified among the direct equity rows used here.

A broad financial fund can already own some banks that appear in a regional-bank ETF. Adding a regional-bank ticker can increase the weight of certain lenders, while the rest of the broad fund remains allocated to other financial industries. For the existing comparison of broader financial-sector baskets, see XLF, VFH, and IYF holdings and overlap.

Suppose an account holds $5,000 of KRE and $5,000 of IAT at the September 24 weights. This is a look-through illustration, not a suggested allocation and not a forecast. The two funds share 25 stock tickers; applying each fund’s weight to its $5,000 sleeve produces about $4,244.61 of combined account exposure across those shared names, or 42.45% of the $10,000 account.

The largest company exposures in the example are U.S. Bancorp at about $757 ($5,000 × 15.14% in IAT), PNC at about $741 ($5,000 × 14.82% in IAT), and Truist at about $533.22 ($5,000 × 1.0744% in KRE plus $5,000 × 9.59% in IAT). The resulting total depends on the holdings date and displayed weight precision. The example makes a practical point: two funds with “regional bank” in their investment story can assign very different dollars to the same company.

At issuer-listed annual expense ratios checked September 26, $5,000 in KRE at 0.35% corresponds to about $17.50 and $5,000 in IAT at 0.37% to about $18.50, for $36 in flat-balance arithmetic. A $10,000 KBWB position at 0.35% would imply about $35, while $10,000 in XLF at 0.08% would imply about $8. Actual expenses accrue over time against changing fund assets. These calculations exclude brokerage costs, bid-ask spreads, taxes, and balance changes; they are not bills or return estimates. See market-cap versus equal weighting for more on how weighting changes portfolio exposure.

A stock ETF is not a bank deposit. Its shares can lose value, and the value is not insured by the FDIC. Holding dozens of bank stocks can reduce dependence on one issuer, but cannot remove risks that affect several banks at once.

Bank earnings and stock prices can respond to the difference between the yields earned on loans and securities and the cost and speed at which deposits reprice. Interest-rate changes may lift asset yields while also increasing deposit costs; they may also change the market value of longer-duration securities. The Federal Reserve’s May 2026 Financial Stability Report, funding-risk section says aggregate funding risks for most banks remained moderate in its latest data, while noting uninsured deposits as a funding-risk component. An aggregate assessment does not establish the condition of any one bank.

Credit losses are another channel. A regional lender may have meaningful exposure to commercial real estate, small businesses, consumer loans, or a limited set of local economies. A local downturn can reduce borrowers’ repayment capacity, collateral values, and deposit balances in the same period. The FDIC’s 2026 Risk Review tracks credit and funding risks including commercial real estate and nonbank lending; Federal Reserve research on local deposits and CRE lending describes how geographic concentration can connect local deposits to local commercial-property credit. These are risk channels to examine, not a claim that all regional banks have the same exposure or that current losses are inevitable.

Capital, liquidity, asset mix, deposit composition, loan underwriting, and geographic concentration differ issuer by issuer. Equal weighting changes how much each company contributes to the basket; it does not change the loans or funding of the underlying banks. A market-cap cap does not prevent portfolio losses. Read the current fund documents and company filings for the exposures relevant to a decision, and do not infer deposit insurance from a fund’s bank holdings.

Start by choosing the exposure you mean. KRE’s benchmark is specifically a modified equal-weighted regional-bank index. IAT’s regional selection is float-adjusted market-cap weighted with index limits. KBWB represents a broader bank and thrift index with modified capitalization weights. XLF spans financial industries beyond banks. “More holdings” and “regional” do not tell you how much money the largest issuers receive.

Then align the date and denominator. Use each fund’s actual holdings file; separate common stock from cash, collateral, money-market funds, and derivatives; match shares by issuer ticker or a stable identifier; and state whether weights are percentages of total fund net assets or the equity subtotal. Recompute the sum of the smaller matched weight if you want a symmetrical look-through comparison. Do not interpret a high stock-overlap percentage as return correlation, and do not add top-ten rows without deduplicating the tickers.

Finally, review expense ratios, trading spreads, turnover, benchmark maintenance, and issuer-level bank risks alongside the basket. Here all four files used for the main comparison are dated September 24, 2026. That makes the arithmetic internally aligned, but it does not make the holdings permanent. This is an educational comparison of index construction and dated portfolios, not advice to buy, sell, or hold any ETF.