Northwest Arkansas, Fort Smith metro commercial banks see slowdown in deposit growth

by Paul Gatling ( 864 views 

A recent report from the Federal Deposit Insurance Corporation (FDIC) shows a slowdown in the pace of deposit growth among banks in Northwest Arkansas and the Fort Smith metro.

The FDIC’s annual Summary of Deposits included data from July 1, 2017, through June 30, 2018. Altogether, 38 banks operating 304 branches in the six-county area of Northwest Arkansas — defined as Benton, Carroll, Crawford, Madison, Sebastian and Washington counties — held $14.81 billion in deposits as of June 30, according to the FDIC data. That’s up less than 1% from $14.73 billion in mid-2017. Previous SOD reports listed $13.5 billion in deposits in June 2016, $12.7 billion in June 2015 and $12.03 billion in June 2014.

Despite a decline in market share from last year, Arvest Bank continues to hold the most deposits in the region, and by a wide margin. The Fayetteville-chartered bank, owned by members of the Walton family, held a combined $5.64 billion in 67 offices throughout the six-county region. That accounts for 38% of area deposits. The lender’s market share was a little more than 41% last year at $6.09 billion.

The bank’s deposits, according to the report, dropped in five of the six counties in Northwest Arkansas. The overall drop in customer funds can be traced almost exclusively to Benton County, with deposits there of $2.92 billion as of June 30 this year. That’s a decrease of 12% compared with $3.3 billion on the same date last year.

The top four banks in terms of market share were unchanged from 2017. The First National Bank of Fort Smith is No. 2 in deposits, topping the $1 billion mark for the first time with $1.02 billion among its 17 branch locations in Northwest Arkansas. Included in those totals is the bank’s local division, First National Bank of NWA, which has five locations in Benton County and one in Washington County.

At No. 3 is First Security Bank. The Searcy-chartered lender, also with 17 offices in the region, holds $841.83 million in deposits. Rounding out the top five are BancorpSouth Bank of Tupelo, Miss. (10 offices, $570.76 million in deposits), and Little Rock-based Bank OZK, formerly Bank of the Ozarks (20 offices, $552.48 million in deposits).

Among locally owned banks, Signature Bank of Northwest Arkansas was the big mover in terms of deposits. The Fayetteville-chartered lender surged in the six-county deposit ranking from No. 10 last year to No. 7, with $429.87 million in its three offices in Northwest Arkansas. That’s up from $346.76 in mid-2017. Percentage-wise, the bank now holds 2.9% of the total market share. A year ago, it held 2.35%.

The bulk of Signature Bank’s growth is in Benton County, where deposits in the bank’s Bentonville branch grew nearly 43% year-to-year. Signature Bank is also expanding with a Rogers branch on South Pinnacle Hills Parkway, a move that will give the bank a branch in each of the region’s four largest cities.

In Benton and Washington counties, which each hold about 35% of the market’s bank deposits, several banks grew their deposit base significantly over the past year. Integrity First Bank N.A., has one office in each county and grew deposits by a combined 282% in those markets, from $5.57 million last year to $21.31 million this year. First National Bank of NWA and Generations Bank, chartered in the south Arkansas community of Hampton, also saw triple-digit deposit increases in their lone Washington County offices.

In Benton County, Springdale-based Legacy National Bank and Paragould-based First National Bank had year-over-year deposit growth of more than 100%.

Using the FDIC data, Talk Business & Politics-Northwest Arkansas Business Journal identified the 20 branches in the six-county area that held the most customer deposits.

As of the June 30 snapshot, they held a combined $5.28 billion. That’s a 6.2% decrease from the 20 branches that held the most deposits on June 30, 2017.

By a wide margin, the wealthiest bank branch in Northwest Arkansas is the Arvest Bank branch on Bentonville’s downtown square. It held a total of $999.1 million. Of the top 20 banks, half of them are Arvest Bank branches.

Overall, there are 12 bank branches in the six-county area with at least $200 million in insured deposits — three each in Fayetteville and Fort Smith, and two each in Bentonville, Rogers and Springdale.

New to the Top 20 this year is the Anstaff Bank branch at 100 First National Ave. in Green Forest.