CALIFORNIA BUSINESS MINUTE
Community Banking
03-11-09
Hi, I am Tim Johnson and welcome to the California Business Minute.
The results of a new survey completed for the Independent Community Bankers of America,
ICBA a Washington D.C. based lobbying group found that more than half (55 percent) of the
nations community banks are seeing deposits increase, according to a survey of its members
done for the Independent Community Bankers of America, a Washington, D.C.-based lobbying
group.
While the financial crisis has affected banks of all sizes and in all regions, community banks
continue to lend and are typically faring much better than the larger banks because they didnt
participate in the high-risk activities that led to problems we are experiencing, says ICBA
President and CEO Camden Fine. This survey clearly shows that the vast majority of community
banks are well-positioned to survive the economic downturn and, perhaps, even reclaim some of
the customers from larger banks, he says.
Of the community banks surveyed, 55 percent have seen an increase in deposits as a result of
new customer acquisition. Only 17 percent have had customers withdraw deposits from their
institutions
Community banks are acquiring new customers at a faster rate than in the past. Of the
community banks surveyed, 57 percent saw an increase in new retail customers during the
third and fourth quarters of 2008 compared to the first half of the year, while 47 percent saw
an increase in new business customers
Community banks are still lending, and 40 percent have seen an increase in loan origination
volume over the last year. Only 11 percent believe the crisis has significantly curtailed their
institutions ability to lend. Economic compression and mixed messages from the U.S. government
are key factors driving down loan activity.
I am Tim Johnson and this has been the California Business Minute.
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