Great Southern Bank is back atop the deposit market share in the Springfield metropolitan statistical area, overcoming Commerce Bank’s one-year lead, according to Federal Deposit Insurance Corp. data released Oct. 2.
The top three positions – held by Great Southern, Commerce and Empire banks – were within three percentage points of each other, based on FDIC data, with Liberty Bank, at No. 4, landing roughly 5 percentage points behind Empire Bank. As of June 30, Great Southern held 14.6 percent of the deposits in the five-county market; Commerce controlled 13.9 percent of the market share; and Empire managed 11.7 percent of local deposits, according to the FDIC’s summary of deposits report.
While Great Southern Bank reclaimed the area's deposit market share lead, several banks changed positions in the five-county Springfield region. The 41 institutions operating in the region held a combined $7.9 billion in deposits, up 7 percent from last year.
For the first time in history, both Great Southern and Commerce this year topped $1 billion in deposits within the MSA. Great Southern posted $1.2 billion and Commerce held $1.1 billion at branches across Greene, Christian, Webster, Polk and Dallas counties.
Executives at both banks downplayed the milestone.
“We don’t set goals like that – to top $1 billion in deposits in the Springfield marketplace,” said Great Southern President and CEO Joe Turner, noting Great Southern Bancorp’s late 2011 acquisition of Sun Security Bank, which operated three branches in the MSA, factored into its deposit growth. “The summary of deposits measure is fairly fluid.”
Commerce took the lead in local deposits last year at 12.5 percent, ending Great Southern’s nine-year run at the top, 2002–10. Commerce had been top dog in terms of MSA deposits between 1998 and 2001.
“It is not an important number,” said Bob Hammerschmidt, Commerce Bank regional president for the Springfield area. “It’s not anything we hoot and celebrate about.”
The 41 institutions in the MSA held a combined $7.9 billion in deposits, up 7 percent from $7.4 billion in the market last year.
Hammerschmidt said while deposits are growing, the challenge is growing loan volumes. “Our loan growth has not kept pace with our deposit growth,” Hammerschmidt said. “It’s ironic, because during the last three years, we’ve had the lowest rates that we’ve ever had on savings and (certificate of deposit) accounts.”
Net loans and leases for Commerce Bancshares Inc., which operates 360 branches in five Midwestern states, were up 1.4 percent for the 12 months ending June 30, while total deposits were up 7.5 percent during that time, according to
FDIC.gov.
The Commerce data are reflective of the post-recession banking market.
According to the FDIC, total loans for all insured institutions are down 5 percent the last five years as of June 30, while total domestic deposits are up 29 percent during that period.
“There were too many inappropriate loans, especially mortgage loans. There was just too much credit extended to consumers and businesses, and it has taken awhile to clean that up,” Hammerschmidt said. “It is not all the way cleaned up, yet, but we have turned a corner.”
Hammerschmidt said Commerce has advised customers to put their money in three areas of alternative investments: its brokerage company, its capital markets group and its trust department. He said the three alternative investment portfolios combined are up 30 percent since 2007 and now exceed the bank’s total local deposits.
Among the deposit market share changes, Springfield First Community Bank inched up a spot to No. 9, exchanging ranks with Metropolitan National Bank. BancorpSouth climbed ahead of Bank of America to claim the No. 6 position.
Deposits at Metropolitan National have declined by $24.5 million the 12 months ending June 30, a drop President and CEO Mark McFatridge said is due to the bank targeting smaller markets. Metropolitan National, which operates 12 branches in nine Missouri towns, is focused on pulling in deposits in nearby communities such as Marshfield, he said, where the bank is No. 1 in market share. McFatridge said by fighting for deposits in smaller markets, it reduces expenses and makes lending more profitable.
On the lending side, Metropolitan National officials have watched its net loans and leases slip by 17 percent through June 30, according to the FDIC. McFatridge – who succeeded Sterling Huff in May, after Huff exited abruptly in November – said loans have picked up recently due to a focus on assisting existing customers and are keeping pace with 2011 volumes. The bank’s monthly loan amortization is nearly $3.5 million. “Frankly, there is just not a whole lot of organic loan demand or projects going on that need funding,” McFatridge said.
Hammerschmidt agreed, saying due to growing deposits, there is plenty of money to loan.
“Deposit growth is like turning water on with a faucet,” he said. “You can turn it on by raising rates and deposits will flow like magic. You can turn it off by lowering the rates. We just don’t have the faucet wide open at all. It is just trickling, honestly.”
Loan volume at Great Southern is up 22 percent according to the FDIC. “We’re looking to grow our business one customer at a time, and we’ll let the deposit market share numbers fall where they may,” Turner said.
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