Community Banks Thrive In The Land Of The Giants
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SOURCE: BUSINESS TODAY
BY: GAIL MARTIN |
 Friday,
April 14th 2006 - Concord, NC - Although
the Charlotte area is home to two of the largest banks in the
country, community banking is alive and well in the shadow
of the Bank of America tower. "The market seems to hold
an opinion as to the continuing value and viability of community
bank charters," says Ray Grace, director of the bank applications
office with the N.C. Commissioner of Banks.
In all, North Carolina had 57 banks with less
than $250 million in assets out of the state's 106 Banks and
Trusts, in 2005.
Which is more profitable - big or small? Return
on assets and equity is standard measure of bank profitability.
"In 2005, banks with more than $1 billion in assets had
an aggregate return on assets (ROA) of 1.32 percent and an
aggregate return on equity (ROE) of 13.88 percent," says
Grace. "Those
with less than $1 billion in assets had aggregate ROA and ROE
of .96 percent and 8.82 percent, respectively," he adds.
Shareholder value may be measured in percentages, but customers
vote with their feet. Small business borrowers seem to prefer
to deal with a local banker and an institution where loan decisions
are made locally. By those measures, community banks are thriving.
They're doing extremely well, extraordinarily well," says Grace.
Pat K. Horton is CEO of Cabarrus
Bank & Trust (CB&T), the states 88th largest bank with $64 million in assets
and $57 million in deposits. Horton believes that community
banks provide a valuable service by keeping deposits and loans
within the community. CB&T's customers want "more of a warm
and cozy feeling ... someplace they could call home,: she says.
We strive to get to know our customers on
a personal basis. Once that rapport is established, I'm going
to call it loyalty. We have to be really really good at these
things to keep people coming back," says Horton.
While Horton agrees that many of CB&T's
customers are "more
mature," she emphasizes that the bank has the resources
and technology in place to compete, including a state-of-the-art
imaging system. CB&T also offers all-day banking, with
same-day credit - the area's largest banks require deposits
to be made before 2pm. CB&T Leadership
Banking customers
can use any bank's ATM anywhere and pay no fee - either to
CB&T
or to the host bank. That is a way of reaching out to younger
customers, says Horton. CB&T
actively asks its current clients for referrals to their children
and grandchildren.
Horton has been in banking for 36 years and
is one of only two female bank CEO's in the state. "Our
holding company really doesn't look at gender, there's no glass
ceiling,"
she says of CB&T. "I try harder - I think women have
to try harder," she laughs. "I don't think just being
a women has made that much of a difference here. What
matters more is knowing the community,"
says Horton. "All our team members are local and
participate in the community."
"Larger
banks can afford
to throw lots of dollars and buy any market they choose,
but in the end, it comes back to service. People will
eventually get tired of being a number and not a face."
Cabarrus Bank & Trust focuses on directing
local dollars back into the community. This may be in the form
of loans to help local businesses, create jobs or through philanthropic
programs designed to promote educational excellence.
By working together, we can continue to enhance
the well being of the counties we serve and make a difference
in our community.
Cabarrus Bank & Trust operates full
service banking offices in Concord and Mt. Pleasant. Uwharrie
Capital Corp, the parent company, is a multi-bank holding
company located in Albemarle, NC. The corporation offers
a full range of financial solutions through its financial
services companies including Cabarrus Bank & Trust,
Anson Bank & Trust, Bank of Stanly, Strategic
Investment Group and Strategic
Investment Advisors.
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