diff --git a/app/Http/Controllers/Settings/BankSearchController.php b/app/Http/Controllers/Settings/BankSearchController.php
index de18f9d5..2578bddf 100644
--- a/app/Http/Controllers/Settings/BankSearchController.php
+++ b/app/Http/Controllers/Settings/BankSearchController.php
@@ -9,9 +9,6 @@ use Illuminate\Http\Request;
 
 class BankSearchController extends Controller
 {
-    /**
-     * Search banks by query.
-     */
     public function __invoke(Request $request): JsonResponse
     {
         $query = $request->input('query', '');
@@ -29,7 +26,14 @@ class BankSearchController extends Controller
                     ->orWhereNull('user_id');
             })
             ->where('name', 'like', '%'.$query.'%')
-            ->orderBy('name')
+            ->orderByRaw('
+                CASE
+                    WHEN LOWER(name) = LOWER(?) THEN 1
+                    WHEN LOWER(name) LIKE LOWER(?) THEN 2
+                    ELSE 3
+                END,
+                name
+            ', [$query, $query.'%'])
             ->limit(100)
             ->get(['id', 'name', 'logo']);
 
diff --git a/tests/Feature/Settings/BankSearchTest.php b/tests/Feature/Settings/BankSearchTest.php
new file mode 100644
index 00000000..6644d7ab
--- /dev/null
+++ b/tests/Feature/Settings/BankSearchTest.php
@@ -0,0 +1,109 @@
+<?php
+
+use App\Models\Bank;
+use App\Models\User;
+
+use function Pest\Laravel\actingAs;
+
+beforeEach(function () {
+    $this->user = User::factory()->create();
+    actingAs($this->user);
+});
+
+it('requires at least 3 characters to search', function () {
+    $response = $this->getJson(route('banks.search', ['query' => 'ab']));
+
+    $response->assertSuccessful()
+        ->assertJson([
+            'banks' => [],
+            'message' => 'Type at least 3 characters to search',
+        ]);
+});
+
+it('prioritizes exact matches first', function () {
+    Bank::factory()->create(['name' => 'ABC Banking']);
+    Bank::factory()->create(['name' => 'ING']);
+    Bank::factory()->create(['name' => 'Test ING Bank']);
+    Bank::factory()->create(['name' => 'Other Company']);
+
+    $response = $this->getJson(route('banks.search', ['query' => 'ING']));
+
+    $response->assertSuccessful();
+
+    $banks = $response->json('banks');
+
+    expect($banks)->toHaveCount(3);
+    expect($banks[0]['name'])->toBe('ING');
+});
+
+it('prioritizes names starting with query second', function () {
+    Bank::factory()->create(['name' => 'ABC Bank']);
+    Bank::factory()->create(['name' => 'Test Bank']);
+    Bank::factory()->create(['name' => 'Bank of America']);
+    Bank::factory()->create(['name' => 'Banking Solutions']);
+
+    $response = $this->getJson(route('banks.search', ['query' => 'Bank']));
+
+    $response->assertSuccessful();
+
+    $banks = $response->json('banks');
+
+    expect($banks)->toHaveCount(4);
+    expect($banks[0]['name'])->toBe('Bank of America');
+    expect($banks[1]['name'])->toBe('Banking Solutions');
+    expect($banks[2]['name'])->toBe('ABC Bank');
+    expect($banks[3]['name'])->toBe('Test Bank');
+});
+
+it('sorts results alphabetically within priority groups', function () {
+    Bank::factory()->create(['name' => 'Zebra ING Bank']);
+    Bank::factory()->create(['name' => 'ING Direct']);
+    Bank::factory()->create(['name' => 'ING']);
+    Bank::factory()->create(['name' => 'Alpha ING Bank']);
+    Bank::factory()->create(['name' => 'ING Bank']);
+
+    $response = $this->getJson(route('banks.search', ['query' => 'ING']));
+
+    $response->assertSuccessful();
+
+    $banks = $response->json('banks');
+
+    expect($banks)->toHaveCount(5);
+    expect($banks[0]['name'])->toBe('ING');
+    expect($banks[1]['name'])->toBe('ING Bank');
+    expect($banks[2]['name'])->toBe('ING Direct');
+    expect($banks[3]['name'])->toBe('Alpha ING Bank');
+    expect($banks[4]['name'])->toBe('Zebra ING Bank');
+});
+
+it('is case insensitive', function () {
+    Bank::factory()->create(['name' => 'ING']);
+    Bank::factory()->create(['name' => 'ing direct']);
+    Bank::factory()->create(['name' => 'Test ing Bank']);
+
+    $response = $this->getJson(route('banks.search', ['query' => 'ing']));
+
+    $response->assertSuccessful();
+
+    $banks = $response->json('banks');
+
+    expect($banks)->toHaveCount(3);
+    expect($banks[0]['name'])->toBe('ING');
+});
+
+it('includes both user banks and global banks', function () {
+    Bank::factory()->create(['name' => 'User Bank', 'user_id' => $this->user->id]);
+    Bank::factory()->create(['name' => 'Global Bank', 'user_id' => null]);
+    Bank::factory()->create(['name' => 'Other User Bank', 'user_id' => User::factory()->create()->id]);
+
+    $response = $this->getJson(route('banks.search', ['query' => 'Bank']));
+
+    $response->assertSuccessful();
+
+    $banks = $response->json('banks');
+    $bankNames = array_column($banks, 'name');
+
+    expect($banks)->toHaveCount(2);
+    expect($bankNames)->toContain('User Bank');
+    expect($bankNames)->toContain('Global Bank');
+});