Bank of America Corp. claimed the top spot on the Business Journal’s annual list of 41 banks operating here; its deposits climbed 5.6% to $24.1 billion as of mid-2019.
“This represents over a billion dollars more than the year prior,” said Mark Sederquist, who leads California consumer banking and investments for the bank.
Bank of America’s “high tech, high touch” approach has been well received in Orange County,” Sederquist told the Business Journal in comments for our Q&A feature with several OC banking leaders (see article, page 20).
It’s the second straight year atop the list for B of A after longtime leader Wells Fargo & Co. lost deposits amidst notorious headlines in recent years. Wells Fargo’s OC deposits fell 2% to $22 billion, good enough for second place; its employee count dropped 13% to 2,711.
No. 3 JPMorgan Chase & Co. reported a 4.3% rise to $16.8 billion and a 5.9% jump in OC employees to 1,800.
The list ranks banks with headquarters or significant operations here and a minimum of $200 million in local deposits based on data from the Federal Deposit Insurance Corp. The banks supplied information on local employees and branches, statistics that don’t factor into rankings.
Overall, deposit growth was faster, 5.4% to $125.9 billion, than a year ago, when it was 2.1%, but still below the 9% growth reported in June 2017.
Branching Out
Perhaps the most significant trend in banking is growing deposits amid falling employee counts: 1.3% to 16,875.
In addition, only one bank grew branches in OC: No. 7 Pacific Western, which added two. Overall, the total declined 3.6% to 584 and bankers say these branches are often smaller than in years’ past.
In 2013, the 40 largest banks in OC reported 719 local branches.
U.S. Bank dropped its branch count the most, declining by 12 to 60; its employee count also fell 12% to 1,031.
Consumers are choosing to use “digital and mobile banking platforms [and] many banks are reconfiguring their branch networks,” Joseph Hensley, market president in Orange County for U.S. Bank, told the Business Journal in his Q&A responses.
Fewer locations, often smaller—and different inside.
Locations “complement and align with that digital experience,” Hensley said, and several OC bankers said that since common banking activities, for businesses and consumers, can be done on phones or online, locations are becoming better suited to personal interactions and more complex financial discussions.
Interiors have taken on a more comfortable look and feel and can be ways to build relationships: “We see branches continuing to play a key role into the future,” Hensley said.
Big Movers
Notable changes on the list include:
• The fastest-growing bank for deposits: Garden Grove-based U.S. Metro Bank, No. 36, where deposits jumped 48% to $261 million. The bank serves mainly Korean Americans and has credited the increased business to new branches in Anaheim and Los Angeles.
• Fourteen banks with deposits climbing more than 10% compared with 12 banks a year ago and 22 in 2017.
• Nine banks showing a decline in deposits, compared with 16 a year ago. The biggest drop was 8.6% to $3.7 billion at Santa Ana-based Banc of California Inc., where new Chief Executive Jared Wolff has embarked on a strategy to reduce deposits that pay high interest.
• No. 9 Pacific Premier Bancorp entered the list’s top 10 from deposits added by a big acquisition in 2018. Now the second largest OC-based bank with $3.6 billion in OC deposits, it should be the biggest locally based one next year after buying Opus Bank, No. 11 with $3.5 billion in OC deposits.
• Besides U.S. Bank and Wells Fargo with double-digit employee drops, Union Bank said it now employs 1,003, a 12% decline from the prior year.
• The biggest employment increase by percentage was 28% to 41 at Irvine-based Nano Banc (see article, page 1).
Others on a hiring spree included Irvine-based Sunwest Bank, up 19% to 210, and Irvine’s First Foundation Inc., up 17% to 297.
