Bank deposits dip across the state

Consumers across the state pulled $267 million out of Arkansas banks this past year, as deposits among the 1,442 bank branches declined by 0.5% from a year ago, according to the annual summary of deposits report made public by the Federal Deposit Insurance Corp. on Monday (Sept. 30).

Arkansas banks held deposits of $53.116 billion as of June 30, down by a fraction overall. Arvest Bank conceded the biggest losses, but maintained it’s No. 1 spot with $6.2 billion in Arkansas deposits as of June 30. The bank’s 11.67% marketshare declined from 12.07% a year ago. Roughly half of the banks doing business in Arkansas conceded some maketshare to others.

Economists have said more money has moved into equity securities over the past year as consumers grew tired of near 0% interest rates held low by the Federal Reserve.

A year ago banks across the state reported cumulative deposit growth of 2.68%, with Northwest Arkansas boosting its deposits by 7.77% and banks in the Fort Smith area registered a flat growth rate of 0.11%.

As of June 30, consumer bank deposits declined 6.67% in the Northwest Arkansas metro area from the prior year. There were 207 branches in the metro area with total deposits of $8.277 billion.

In the Fort Smith market consumers socked away $4.057 billion in deposits as of June 30. Deposits slid 0.15% from the June 2012 among the 120 branches in that metro area.

NWA SHAKE-UP
The banking climate in Northwest Arkansas remains highly competitive for loans and deposits. During the past year deposit marketshare shifted a bit from Arvest Bank, Signature Bank and Bank of Fayetteville, toward First Security, Bank of America and Legacy Bank.

Arvest continues to hold a lion’s share (47.44%) of the local deposits totaling $3.926 billion as of June 30. Deposits dropped by roughly 13% from a year ago with the Bentonville-based bank conceding 3.92% of its share to other area banks.

Ranked No. 2 in marketshare First Security Bank make up ground in the past year growing area deposits by $52.7 million, according to the FDIC report. First Security has 8.11% of the local market and continue to grow that share, said David Russell, president of the bank’s Fayetteville market.


“The majority of our growth came in core deposits, we have not been aggressively trying to attract business by paying unusually high rates, we price competitively and have seen some flight toward safety,” Russell said.

He said the bank’s “Only in Arkansas” campaign has also resonated well with consumers as so many of the state’s larger banks have invested well beyond Arkansas’ borders.

The bank recently purchased a new branch in Farmington from First Federal and reopened it today under the First Security Bank banner. Russell said First Security just acquired the deposits of that Farmington branch, roughly $9 million, which are not part of the FDIC results.

Legacy Bank also picked up about $17 million in additional deposits through June 30. CEO Don Gibson said through Sept. 30 deposits rose to $219 million, up another $9 million since June.

“We are pleased with the steady growth in our core deposits. About half of our total growth is in checking and other transaction accounts, while the other half is in certificate of deposit,” Gibson said.

He described the local banking climate in football terms, saying there is a lot of blocking and tackling going on with slow progress moving down field. Gibson said there is still limited expansion and investment going on as  many small companies still lack the confidence they need to spend their reserves.

“When loan demand is this competitive it’s not usual to see more banks shrinking back their deposits and managing their balance sheets,” Gibson said.

NWA Marketshare
• Arvest Bank 47.44%, down from 51.36%
• First Security 8.11%, up from 6.98%
• Bank of America 3.69%, up from 3.06%
• Signature Bank 3.30%, down from 3.48%
• Bank of Fayetteville 3.42%, down from 3.47%
• Bank of Arkansas 3.11%, up 2.71%
• Liberty Bank 2.58%, up from 2.44%
• Legacy Bank 2.54%, up from 2.17%
• Simmons First 2.39%, up from 2.27%
• Chambers Bank 2.01%, down from 2.14%

FORT SMITH STABILITY
In the Fort Smith market, First National Bank held its top spot in terms of market share with 18.31% of the total deposits valued at $743 million, as of June 30. From June to June the FDIC report indicated First National Fort Smith deposits slid by $13 million. Marketshare shaved back from 18.61% as of June 30, 2012.

Sam T. Sicard, CEO of First National Bank, said over the past 12 months deposit balances are up 2%.

“We have experienced significant growth in the number of checking and savings account over the past year, and the total amount of checking and savings account deposit balances at First National are up significantly over the past year as well,” Sicard said in an e-mail response.

He said certificates of deposits are down over the past 12 months.

“First National is in a strong capital and liquidity position, and we are focused on deploying these excess funds back into our local economies through lending to local  families and local businesses. We hope to have more lending opportunities as our local economies strengthen in the future,” he said.

Arvest Bank grew its marketshare in the Fort Smith market by 1.26% or $50 million from June to June. Arvest ranks No. 2 behind First National Bank Fort Smith in that metro area with 14.56% of the market or $590 million.

Bentonville-based Arvest did not return two requests for comment.

BancorpSouth also picked up some marketshare – roughly $9.3 million – according to the June 30 reports. Ranking third in the Fort Smith metro area, BancorpSouth showed deposits of $508 million or 12.52% of the market as of June 30.

Citizens Bank & Trust logged fewer deposits in the year-over-year period. Ranking fourth in marketshare Citizens had $310 million or 7.65% of the local share as of June 30. That compared to $323 million or a 7.96% share of the market a year ago.

Regions Bank rounded out the top five in the local market with $225 million in deposits, down 7% from the prior-year period.

While most of the banks in the market posted a slight decline in deposits through June 30, Farmer’ Bank grew its deposits by more than $4.4 million from the prior year.

Farmer’s Bank held a 3.66% marketshare as of June 30, with deposits of $148.3 million. Greenwood-based Farmer’s Bank moved up one rank to crack the top 10 this year.

Fort Smith Marketshare
• First National Bank 18.31%, down from 18.61%
• Arvest Bank 14.56%, up from 13.30%
• Bancorp South 12.52%, up from 12.15%
• Citizens Bank & Trust 7.65%, down from 7.96%
• Regions 5.56%, down from 5.98%
• Central Bank of Poteau 4.64%, up from 4.61%
• Firstar Bank 4.13%, down from 4.34%
• Armstrong Bank 4.04%, up from 3.77%
• Benefit Bank 3.85%, down from 4.11%
• Farmers Bank 3.66%, up from 3.51%