Commercial banks operating in Orange County reported their third straight year of increasing deposits by more than double digits.
The 48 banks on the Business Journal’s annual list reported deposits climbed 11% to $192.1 billion for the period ended June 30, 2022. In the prior two reporting periods, bank deposits climbed 15% and 23%, respectively. By contrast, deposit growth in the three prior years ranged from 2.1% to 9%.
Twenty-six of the banks reported deposit growth topping 10%. Nine reported declines.
The industry’s headcount in Orange County showed stabilization, growing 2.5% to 15,590 after falling 5.5% a year ago.
The list ranks commercial banks with branches here and a minimum of $200 million in local deposits based on data from the Federal Deposit Insurance Corp. The FDIC lists another 65 banks with offices in Orange County that don’t meet the $200 million minimum for the Business Journal list.
Most banks on the list supplied information on local employees, statistics that don’t factor into rankings.
Branch Declines
The industry continued the trend of reducing branches, which in Orange County fell from 570 to 544.
Six banks increased their branch count on this year’s list.
One of those was No. 11 Farmers & Merchants Bank, which found validation in its strategy of attracting customers through branches and rose by one to 14 in Orange County. Its deposit base climbed 13% to $4.9 billion, and it also increased its employee count 7.3% to 515.
By contrast, Irvine-based Nano Bank, which began in 2018 by touting its online presence to reduce costs, fell five spots to No. 30, the most on the list, as deposits fell 22% to $841 million. Its employee count, however, rose 45% to 68.
The bank was in turmoil last year when regulators said it had grown too fast and it forced management changes.
BofA Tops
Bank of America Corp. for the fifth straight year claimed the top spot as its deposits climbed 9.1% to $33.8 billion, which follows a 14% increase a year ago. A decade ago, the bank had $14.2 billion in deposits.
Nipping at its heels was No. 2 Wells Fargo Bank, which before BofA was the largest in Orange County; its OC deposits increased 3.2% to $31.5 billion. Its employee count rebounded 6.7% to 2,076 workers, after having dropped 14% in last year’s report.
“Between supply chain stagnation, rapid inflation, rising interest rates, and one of the tightest labor markets to date, Orange County business leaders continue to operate in an environment that many haven’t seen in their professional lifetimes,” Manishi Parikh, Wells Fargo’s Orange County commercial banking market executive, told the Business Journal.
“While escalating interest rates are no longer a surprise, with each Fed announcement, I’m having more conversations with Orange County business leaders to help them develop creative financing solutions to meet their short and long-term goals,” she said.
Coming in a close No. 3 was JPMorgan Chase & Co., which reported another banner year, boosting deposits 14% to $30.8 billion. In the prior two years, its deposits have jumped 26% and 28%. A decade ago, the bank reported $7.7 billion in OC deposits.
Signature’s Debut
New York-based Signature Bank made its appearance on the list as the fastest growing, increasing its deposits 436% to $570.9 million, good enough for No. 33.
The bank in 2020 opened a Newport Beach office and hired Emilie McMurray, a prominent local banker from rival JPMorgan Chase.
Another high grower was First Citizens Bank, which rose 243% to $1.4 billion. The bank, which calls itself America’s largest family-controlled bank, made the biggest jump on the list, climbing 14 spots to No. 23.
Other banks that topped 100% deposit growth include: No. 37 United Business Bank, up 187% to $340 million; No. 43 Liberty Bank, up 174% to $268 million, and No. 46 Enterprise Bank & Trust, up 158% to $207.9 million. No. 27 Hammi Bank, which grew deposits 17% a year ago, reported only 1% growth to $878 million.
“The real estate transaction process is slowing down as buyers must consider more diligently the impact the financing costs have on their investment decisions, while sellers are not adjusting their pricing,” said Matthew Fuhr, the bank’s chief credit administration officer told the Business Journal.
The bank’s small business lending in Orange County is consisting primarily of working capital requests and partner buy outs and there hasn’t been much purchase activity, he said.
Umpqua Bank reported its deposits climbed 14% to $678 million. It will soon have more resources following its $5 billion merger with Columbia Banking Systems, which when combined will become one of the largest banks on the West Coast with more than $50 billion in assets. Regulators gave their final approvals in January and the transaction is expected to close around the end of this month.
