They steal competition. They restructure rates. They renovate branches, renew relationships and in some cases resist change to gain a reputation of consistency.
And though their battle plans differ, their eyes are always steadily fixed on the competition.
Maybe it’s that Colorado Springs has a transient element to it, said Tom Naughton, U.S. Bank regional president, Southern Colorado region. The chase of new clients is sport among bankers and has attracted out-of-state banks to open branches in El Paso County. Thirty-eight banks in El Paso County are vying for market share, and that does not include the credit unions.
“This market has always been very competitive,” Naughton said.
“We know there are a lot of choices for people,” he said. “We individually, and collectively, focus on being a champion for our clients. We think we will win more than our share of business.”
U.S. Bank is holding strong at No. 3 in deposits, making its slice of the market share pie 10.98 percent. But smaller banks in the market shouldn’t be dismissed.
In November, Kirkpatrick Bank, based in Edmond, Okla., made a bold move in the local banking race by recruiting four well-known, long-time bankers — Lisa Rutherford, Jocelyn Wall, Mark Benes and Bill Berenz — away from ANB Bank, No. 5 in the market, whose local headquarters building can be seen across Cascade Avenue from Kirkpatrick’s window.
Kirkpatrick’s Colorado Market President Trent Stafford made no bones about it. He laid out a five-year plan to double Kirkpatrick in the El Paso County market. If successful, that would move Kirkpatrick out of the bottom third in market share, where it currently sits. He’s counting on 15 to 16 percent growth each year in a market that is only growing 2 percent a year.
“You don’t have to be a rocket scientist to see there is a gap there, which means you have to steal business,” Stafford said. “The way you steal business, really, is to hire the talent out of other institutions and move relationships from those institutions — it’s as simple as that.”
Lonnie Parsons, ANB regional president of Southern region, hardly seems fazed by four long-time bankers jumping the ANB ship to Kirkpatrick. The vacancies, he says, allowed him to restructure the team to fit a new culture.
“You think you are universally loved as a banker and when you move, (the clients) will follow,” Parsons said. “Well, that doesn’t happen.”
Parsons left Vectra Bank’s Pueblo office, in August for ANB, whose parent company is Denver-based Strum Financial Group. Under his direction, ANB in Colorado Springs — a bank that captures about 5.45 percent of local deposit market share — has made a dramatic shift in its culture, one that deploys a community-banking model of partnering with clients and making decisions locally.
“We call ourselves a community bank and we believe that is a big responsibility,” Parsons said. “My boss tells me to run this bank like I own it.”
No banker in town talks business without invoking the new banking buzzword — relationships. It’s become so much a part of the banking vernacular that it’s even made its way into duty titles. Ted Mossman just left Vectra Bank, where he was market president of Colorado’s Pikes Peak region since February 2008, for a bigger whale, Wells Fargo, where he is the principal relationship manager for business banking in Southern Colorado.
“This is the best time for small businesses, that are doing well, to take advantage of what banks are offering — rates, structure, securing long-term fixed rates . . . the opportunities they have to reinvest are there and banks are willing to do what it takes to earn their business,” Mossman said.
In El Paso County, Wells Fargo is the one to beat: With 27.66 percent of the market share, Wells is the No. 1 institution with $1.6 billion in deposits. The bank has 17 offices and 11 bankers in the Springs dedicated to business banking. What it needs now is to start moving money, Mossman said. And that is going to require building relationships with the business community.
“Part of what is happening, is that Wells is so well capitalized with billions upon billions in deposits — we’re working on deploying that to small and mid-size businesses,” Mossman said. “And part of that is having the right team and the right level of expertise to get out there and execute.”
When Stafford assembled Kirkpatrick’s new team members in November, they sat around the conference table and brainstormed all the potential clients they could reach out to and pursue. Kirkpatrick is a community bank but is gunning for a specific niche — business banking. It sees its competitors as the big guys — Wells, U.S. Bank, ANB and UMB.
“We are competing for similar space — commercial and commercial real estate,” Stafford said.
Kirkpatrick’s business model also is based on relationships, Stafford said, and that’s why he recruited bankers with decades of business banking experience to his team. Kirkpatrick’s biggest weakness in the local market has been name recognition, he said.
“I believe people put a lot of value on service levels — relationships and speed in decision-making,” Stafford said. “And, they are willing to pay some premium to do that. If it’s the same deal over here as it is over there, but the relationship resides here, they will move. That is my core belief.”
Parsons said it’s flattering that Kirkpatrick Bank counts ANB as one of its competitors. ANB has a $2 billion portfolio, he said, providing the resources to put together big deals. That, coupled with the new community bank delivery model, is working, he said.
“When I got here, we didn’t have a lot going in commercial,” Parsons said. “We have $70 million in the pipeline in just the last six months — that’s more than we’ve done in the last three years.”
Vectra Bank, a regional bank that has grown locally to No. 17 in market share, sees it differently.
Vectra has turned its attention in recent years to offering specialized bankers to clients as the way to distinguish itself from competitors, said Aileen Berrios, Vectra Bank senior vice president, commercial banking. In this economic environment, she said, clients have come to expect their banker to speak their business lingo and understand the intricacies of their industry.
“I think it’s been evolving for Vectra for the last five years,” she said. “We’ve got specialists in aviation, medical banking, we have a great specialty in energy and oil and gas, municipal financing. We have this figured out — people want experts in their fields.”
Now, specialty banking has become part of Vectra’s brand, Berrios said.
Vectra, along with accounting firm Stockman Kast Ryan + Co. and law firm Holland & Hart, hosts the Southern Colorado Government Contracting Forum for businesses to find out more about government contracting programs. It’s become a key niche market, she said. Local economists have said government jobs, including contractors, make up about 40 percent of the local economy.
“I think people are shopping around, saying, ‘Which bank is perfect for me?’ “ Berrios said. “I see business owners looking around out there — you do have to be competitive . . . When you specialize, you understand their language and the way their business functions. It really makes a difference in partnering with business and helping them grow.”
Vectra, which is part of Zion’s Bancorp. of operations in 10 states, has about $76 million in deposits locally, making up about 1.26 percent of market share. Vectra grew locally in both loans and deposits in 2012, Berrios said. She is expecting more growth in 2013.
Berrios counts the competition as the big banks — those in the top five in the market — and she’s coming for their clients.
What she can promise, she said, is a meeting with the bank’s top leadership to brainstorm business strategy if a small business so desires, she said.
“They can get everything here that they can get at a larger bank,” she said. “They get quite a bit of attention from us.”
It won’t be easy for banks with slivers of market share to carve bigger chunks for themselves. The top 10 banks in El Paso County have 76.5 percent of total market share. And clients like stability, Naughton says. U.S. Bank, which is based in Minneapolis, Minn., was named by Fortune as the 2012 most admired superregional bank in the nation.
“Really, I hate to be simplistic, but some things are time-tested,” he said.
“Customers are looking for safety and soundness. They place a premium on first-class service. And that is how we differentiate ourselves.”
But U.S. Bank is not resting on its No. 3 position in the market. Locally, it has built up its trust and wealth management private client group as another way to distinguish itself from the pack.
“The nice thing about our bank being as large as we are, we adopt best practices from all other markets,” Naughton said. “The local team is like the quarterback and we bring in experts as needed.”
Although Wells Fargo is comfortably at the top of the local banking heap in deposit market share, Mossman says the bank still competes as though others are nipping at its heels. Wells, he says, can afford to lock in low interest rates for a 25-year SBA loan, for example. That kind of deal is what sets his bank apart, he adds. In fiscal year 2012, Wells made 158 SBA loans in Colorado for $51 million — the most in the state.
“We are in a situation where we have the opportunity, with all the products and services, to get out there and have meaningful impact on the market,” Mossman said.
Aside from trying to figure out who will throw the next banking punch, there are other concerns — the economy is still sluggish, and small businesses, some sitting on cash, are reluctant to make a move because of changes in health care and sequestration.
But bankers are not waiting for business to walk through their doors. They are making calls, making appointments, jockeying for time and attention.
As Stafford put it, “All the top-tier clients, who can get credit, know they can get credit and therefore are letting banks compete.”
1. Wells Fargo Bank — 27.66 percent
2. JP Morgan Chase Bank — 11.8 percent
3. U.S. Bank — 10.98 percent
4. First Bank — 5.78 percent
5. ANB Bank — 5.45 percent
6. UMB Bank — 4.83 percent
7. Farmers State Bank of Calhan — 2.67
8. The Bank of Broadmoor — 2.60
9. TCF National Bank — 2.44
10. People’s National Bank — 2.44
11. 5 Star Bank — 2.36
12. Academy Bank — 2 percent
13. Compass Bank — 1.61
14. Great Western Bank — 1.56
15. Integrity Bank & Trust — 1.5
16. Key Bank — 1.31
17. Vectra Bank — 1.26
18. Armed Forces Bank — 1.15
19. Pikes Peak National Bank — 1.12
20. The First National Bank of Las Animas — .96 percent
21. Adams Bank & Trust — .91 percent
22. Bank of Colorado — .84 percent
23. Farmers & Stockmens Bank — .79 percent
24. The State Bank of Bartley — .77 percent
25. Rocky Mountain Bank & Trust Florence — .77 percent
26. Legacy Bank — .67
27. Herring Bank — .55
28. Kirkpatrick Bank — .47
29. First Bank & Trust Company — .43
30. The Pueblo Bank and Trust Company — .41
31. First State Bank of Colorado — .37 percent
32. The Eastern Colorado Bank — .33 percent
33. The State Bank — .31 percent
34. Cañon National Bank — .27 percent
35. American Bank of Commerce — .19 percent
36. First-Citizens Bank & Trust — .17 percent
37. First State Bank — .13 percent
38. First Commercial Bank — .11 percent
Source: FDIC, as of June 30, 2012
Mark White is new president and CEO of The Bank at Broadmoor. He had been with BBVA Compass Bank in Colorado Springs. Ed Sauer retired as president and CEO in December.
David Evanitz was named senior mortgage loan officer at The Bank of Broadmoor in November.
Tamara Gormsen joined Peoples Bank in November as vice president of commercial lending. She had been at UMB Bank.
Esther Ah Yo was promoted in January to commercial banker at ANB Bank.
Collyn Florendo was named Bank of Colorado branch president for the Colorado Springs area in January.
Bank of Colorado promoted Brad Kreikemeier to executive vice president. Previously Kreikemeier was the branch president of the Colorado Springs branches of Bank of Colorado.
Ted Mossman was named in January Wells Fargo’s principal business relationship manager for the business banking team. He was previously with Vectra Bank.
Lisa Rutherford was named in November Kirkpatrick Bank’s vice president treasury management. She was previously with ANB.
Jocelyn Wall was named in November Kirkpatrick Bank’s senior vice president. She was previously with ANB.
Mark Benes was named in November Kirkpatrick Bank’s senior vice president. He was previously with ANB.
Bill Berenz joined Kirkpatrick Bank in November as a consultant in business development and community involvement. He retired from ANB as regional president.
Source: CSBJ People on the Move column, Nov. 1, 2012-Feb. 8, 2013