For the first time, Bank of America has the most local deposits of 56 banks and thrifts doing business in the Wichita area.
According to the Federal Deposit Insurance Corp.’s Deposit Market Share Report, released in October, Bank of America had $2.96 billion in deposits as of June 30. That’s a nearly 76 percent increase in its metro deposits from June 30, 2011, when they totaled $1.68 billion.
Its surge in deposits unseated Wichita-based Intrust from the top spot — a spot Intrust has held since 1997.
Bank of America officials said a host of factors explain the higher deposits.
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Shawn Lancelot, Bank of America’s Wichita market president, said Tuesday that growth in mobile banking and incentivizing existing customers to do more of their financial business with the bank has pushed up local deposits. But retail customers aren’t the sole driver of the more than $1 billion increase. He said the bank’s commercial clients are also “building more cash,” and holding it instead of spending it. That’s because they are waiting for the outcome of federal elections, and they remain uncertain about the direction of the economy, he said. “We love the deposits but we also hope to see our clients use those deposits in the next 12 months,” Lancelot said.
He said the bank locally also has benefited from growth in its investment units, U.S. Trust and Merrill Lynch.
“We are growing our customer base across all of our lines of business,” Lancelot said.
Not all of the bank’s 15 area branches had year-over-year deposit growth. In fact some declined. And one branch, at 100 N. Broadway, an address that also houses its area headquarters, had most of the bank’s deposits for the metro area. “We have a variety of different consumer business, commercial business, treasury management … at 100 (N.) Broadway,” said Bank of America spokeswoman Diane Wagner.
Even though Bank of America holds the most deposits in the U.S., until this year it was never able locally to surpass Intrust, which held the top deposit spot after the former, Wichita-based Bank IV was acquired through a series of mergers in the late 1990s by Bank of America.
Lancelot added that Bank of America will “probably not” see the same kind of deposit growth locally that it’s seen this year, but “we’ll continue to grow our market share.”
Despite losing its spot with the most deposits, Intrust’s public affairs division director Lyndon Wells said the bank is “pleased” with its 6 percent deposit growth, to $2.72 billion.
“If you drill down by banking center location you’ll see growth in virtually all our branches,” said Wells, whose bank’s 30 area branches are double the number of Bank of America branches.
Wells said he did not want to speculate on Bank of America’s surge in deposits.
At the same time, total deposits in the Wichita area — Butler, Harvey, Sedgwick and Sumner counties — increased nearly 15 percent year over year, from $11.37 billion on June 30, 2011, to $13.03 billion.
Roger Kepley, president of Rose Hill Bank, whose deposits grew 2.7 percent in the past year to nearly $235 million, attributes an increase in area deposits partly to a reinvigorated oil and gas industry that is increasing drilling and exploration, proving a financial boon for landowners in the form of new cash from lease payments.
Brad Elliott, CEO of Equity Bank, which had a gain of 11 percent in year-over-year deposits, said banks will likely continue to be deposit rich until consumers and businesses see a positive turn in the economy.
“They are still unsure about the economy,” Elliott said. “People are sitting on lots and lots of cash.”