For the second consecutive year in 2013, Arvest Bank passed the $2 billion mortgage mark. What does this milestone mean for the bank and for the Springfield-area lending market? For the bank, it’s huge. In some instances, not all, it’s an opportunity for us to acquire new customers. We get to interact with a new customer. To attain that $2 billion is a way of building our customer base.
Where it becomes really important, is the more products and services a customer has with you, the less likely they are to leave. To be able to originate that kind of volume helps us in that regard. There is a financial piece to this; there are fees and interest income that comes with those loans. There is a financial reward for the company.
Roughly a tenth of that number was originated in southwest Missouri and Arvest services 99 percent of the loans we originate.
In that $2 billion, the company noted a loan shift: Refinance loans dropped to 59 percent of the total and purchase money loans increased to 41 percent. What’s causing this? On the surface, one might think rates have started to inch up during the past year or so. That’s some of it. Additionally, we are seeing an pick up in purchase transaction activity. The other thing one might think is, everybody who was going to refinance has refinanced and that’s why it’s down. That’s not the case, either. I would argue, even in today’s loan environment, there are still people whose rate is higher and could still benefit from a refinance. It’s a combination of two things: Rates are easing up, but not everybody who should refinance has done it.
In March, Arvest finalized the acquisition of 29 Bank of America Corp. branches including six under the jurisdiction of Arvest Bank in Springfield. How are they progressing? No. 1, we picked up some great associates. It gave us the opportunity to really get out and get involved in those communities and get those loan volumes up. Loan volumes at those locations are goal for the company. We are seeing some movement, and are pleased, but of course we always want more. In all those communities, they fit the footprint we are in. Mt. Grove and Lebanon are a little farther away but great communities to be in. When you look at Aurora, it connects our operations here with operations in Joplin. And Forsyth, Branson West and downtown Branson connect to existing customers already there.
Recently, Arvest expanded its footprint even more, acquiring the National Bank of Arkansas. What do these acquisitions mean for the company? NBA made a lot of sense for us, just as the acquisition with BOA. NBA made a lot of sense from a footprint perspective. We picked up, as a company, about $180 million in assets, and about 5,000 in new households.
It’s always a possibility that we will continue to grow. I would expect our company, as a whole, will continue to grow. But only when it’s going to make sense.
Arvest is currently conducting the first round of its semiannual consumer sentiment survey, aimed at gathering data regarding the economic expectations and outlook of Arkansas, Missouri and Oklahoma consumers. What does the bank hope to gain from this exercise? There is a national survey out there, but when you look locally, there can be variances and specific customer sentiment about line items. Putting this together in the Arvest footprint, our hope is to lay the national data against the regional and local data and see if there are variances and why there are variances.
The other goal is to provide that information to the general public. To help them make decisions in their organizations, based on whatever the information means to them.[[In-content Ad]]
