A federal regulator’s report on bank market share in the Wichita area released Monday shows little change among the top 10 banks’ share of deposits and slower year-over-year growth in total area deposits.
The Federal Deposit Insurance Corp.’s 2013 Deposit Market Share Report shows the deposits that all 57 banks doing business in the area had at the close of business on June 30.
The top nine banks in the 2013 report retained their same spots from a year ago: Bank of America was on top, followed, in order, by Intrust Bank, Fidelity Bank, Emprise Bank, Commerce Bank, Capitol Federal Savings, Southwest National Bank, Wells Fargo and Equity Bank.
What did change was the bank occupying the 10th spot. Colwich-based Legacy Bank, which was No. 11 in the 2012 report, moved to No. 10 in the 2013 report, replacing Rose Hill Bank, which fell to No. 12.
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Legacy’s total deposits rose by nearly $5 million year-over-year, to $222.3 million, according to the report, while Rose Hill Bank’s deposits fell 10 percent to $210.7 million.
Roger Kepley, president of Rose Hill Bank, said Monday that he thinks the bank’s drop in deposits are being driven by two things: a decline in the number of customers taking out interest-bearing certificates of deposit and the conclusion of a CD special that the bank offered when it opened its west Wichita branch.
He said the low interest rate environment combined with soft loan demand make it hard for the bank to justify paying above-market interest rates on CDs. That’s what the bank did when it opened its branch at 3313 N. Ridge Road in late 2009. It was a means to attract customers to the new branch. Those CD specials have since ended, Kepley said, and some of the customers who bought those special CDs closed out their business once those CDs matured. He said those customers never intended to establish other business there, such as checking accounts. “They were just chasing rates,” Kepley said.
Officials at Legacy Bank couldn’t be reached Monday for comment about their rise in deposits. During the reporting period for the FDIC report, Legacy acquired Alliant Bank in Sedgwick, which likely increased its deposit base during that time.
The report said that the amount of deposits in the Wichita area increased by y about only 2 percent between 2012 and 2013, to $13.47 billion. That compares with a more vigorous growth rate of 15 percent in total area deposits between 2011 and 2012.
Rick LeCompte, a finance professor at Wichita State University, said the slower growth in deposits could be the effect of people putting their money into stocks, real estate or online-based banks such as Ally, which pay higher rates on short-term investment products such as CDs than traditional brick-and-mortar banks.