South State Correspondent

JANUARY 10, 2024

Community banks’ use of swaps (banks’ primary tool to hedge interest rate risk on loans) has increased substantially over the last ten years. Meanwhile, community banks face net interest margin (NIM) and fee income pressure. Only 304 banks (or 6.7% of the total) used swaps directly.

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South State Correspondent

JULY 19, 2023

Of the largest 250 banks, 90% are using interest rate swaps, and because these largest 250 banks hold 83% of all loans, interest rate hedging tools are widely used in approximately 75% of the loan marketplace. This is why the current inverted yield curve makes loan hedging especially attractive to community banks.

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South State Correspondent

JUNE 5, 2023

Community bank cost of funds is jumping up. As shown in the graph below, the net interest margin (NIM) for community banks declined 22bps in Q1’23. The question is – what will happen to community bank’s cost of funds from here? Increase product engagement and duration.

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Independent Banker

JANUARY 31, 2023

Inspired by the entrepreneurship of lemonade stands, Scottsdale Community Bank created a microloan program. Photo by Brandon Sullivan De novo Scottsdale Community Bank set out to provide microloans to small and mid-size businesses, family organizations and nonprofits—a project that was inspired by the humble lemonade stand.

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Independent Banker

NOVEMBER 30, 2022

People want to be a part of something bigger than themselves, and community banks provide that opportunity. Community banking is about serving the greater good. As community continuators, we are part of something bigger than ourselves. Photo by Chris Williams.

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South State Correspondent

NOVEMBER 4, 2024

We are seeing more community banks incorporating prepayment provisions in commercial loans (especially for fixed-rate pricing). Most community banks are utilizing a declining balance prepayment provision – which if properly enforced, can create value for the bank.

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Independent Banker

JUNE 26, 2022

Be recognized as one of community banking’s best employers. ICBA Independent Banker ‘s Best Community Banks to Work For award is your chance to show job hunters and current staff why your community bank is an unbeatable place to build a career. Click to nominate your bank. Leadership.

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Abrigo

JUNE 28, 2024

Takeaway 2 Abrigo advisory expert Susan Sharbel offers insights into where your bank should focus its resources to manage interest rate risk, Takeaway 3 Practical steps for preparing your ALM program for rate changes include updating and validating risk models regularly, conducting tests, and reviewing portfolios.

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Bank Innovation

APRIL 10, 2020

The technological upgrades Happy State Bank made prior to the COVID-19 crisis has helped the lender service and onboard customers digitally and deploy its own SBA Paycheck Protection Program platform in a matter of days, CEO J. Pat Hickman told Bank Innovation.

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Payments Dive

MAY 2, 2023

The company that provides community banks with payments, fintech and other services is gunning for growth with new private equity capital.

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Jeff For Banks

OCTOBER 14, 2024

Community banking has almost achieved Kleenex or Xerox fame, being generalized to the point of meaninglessness. PNC ($557 billion in total assets) calls itself a "Main Street Bank." We have not done a good job explaining what a community bank is. They called community banks. Less safe and secure.

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South State Correspondent

JUNE 21, 2022

This regime is now changing, and community banks need to position their lending and deposit portfolios for a period of monetary tightening. Banks that have avoided, or can reduce, their holdings of riskier assets as much as possible will outperform. Conclusion.

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American Banker

NOVEMBER 27, 2024

"Too big to fail" banking giants like to masquerade as community banks when it suits their purposes, but they will never be able to replace real, local bankers with deep ties to their customers.

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American Banker

NOVEMBER 25, 2024

The top five community banks averaged a return on average assets of 6.27% as of June 30.

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Bank Innovation

FEBRUARY 9, 2020

Core providers are rolling out digital bank toolkits that can launch a new offering within 90 days, and Jack Henry is the latest contender to join that race with BankAnywhere, a cloud-based system for community banks. Jack Henry is not the first core provider to roll out a “digital bank in a box” product for […].

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South State Correspondent

JUNE 12, 2019

IMPROVING BANK PRODUCT SALES A surge in alternative lenders and intense competition among banks has forced community bank lenders to further differentiate themselves and their institution. Many lenders are switching their professional focus from being a salesperson to being a trusted advisor. Recent teaching from St.

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South State Correspondent

OCTOBER 30, 2024

In our previous article ( here ) we analyzed the data on community bank M&A and performance, and we concluded that there is no relationship between community bank size and profitability, as measured by return on equity (ROE). The key insight is to understand how growth translates into bank efficiency.

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South State Correspondent

DECEMBER 4, 2024

The graph below shows capitalization, net income, NIM and NPL for failing banks in quarters before failure. The key lesson for community bank executives is to use risk-adjusted, return-on-asset (RAROC) pricing tools to compensate community banks for credit and interest rate risk.

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South State Correspondent

JUNE 11, 2024

FDIC-insured “Problem Banks” list has been increasing over the past two years. For the community banking industry (banks under $10B in assets), this is particularly troubling as the number of community banks earning negative return on equity (ROE) spiked to 237 institutions in Q1/24, or 5.71% of all community banks.

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South State Correspondent

SEPTEMBER 9, 2024

However, for community banks (under $10B in assets), the ROE declined to 10.44% (from 10.57% in the previous quarter). The Data In Q2/24, the number of FDIC insured community banks declined to 4,104 (a decrease of 27 community banks for the quarter). of all community banks had negative ROE for the quarter.

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South State Correspondent

SEPTEMBER 30, 2024

In Q2/24 the average return of asset (ROA) for community banks (under $10B in assets) was 1.08%. But within the community banking sector, performance varied among banks significantly and a large swath of banks need to improve ROA. of community banks reported negative ROA. Another 16.2%

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South State Correspondent

JUNE 18, 2024

Deposit costs and liquidity remain a challenge for some community banks as competition for core funding remains intense. The graph below compares the liquidity ratio for community banks (under $10B in assets) and banks over $100B in assets. Community banks do have a few strategies for mitigating COF pressures.

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South State Correspondent

APRIL 30, 2024

An inverted yield curve, continued bank failures, and the desire to manage risk and offer clients higher service are all factors that are driving more community banks to adopt a loan hedge program. Community banks do this profitably by turning transactional accounts into relationships.

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South State Correspondent

APRIL 30, 2024

An inverted yield curve, continued bank failures, and the desire to manage risk and offer clients higher service are all factors that are driving more community banks to adopt a loan hedge program. Community banks do this profitably by turning transactional accounts into relationships.

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Bank Innovation

FEBRUARY 25, 2020

With the funding, the bank plans to invest in its digital capabilities, providing services that include mobile deposits, secured and unsecured commercial loans, letters of credit and consumer loans. Bank CEO Ed Jones wants Gulf Capital to model community banking relationships, in which […].

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South State Correspondent

OCTOBER 24, 2024

There are many experts who claim that to achieve profitability, community banks (banks under $10B in assets) must gain scale by acquiring assets. On the surface that seems reasonable but does scale in banking result in better performance for community banks? But does size lead to a lower efficiency ratio?

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Independent Banker

MARCH 31, 2022

Executive committee members tell us what advocacy issues they’ll be focused on during their terms, while board members share their words of wisdom for up-and-coming community bankers: themselves. To sum it up, these leaders are all in and all heart for community banking. We are not Wall Street banks—we are community banks.

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South State Correspondent

MAY 15, 2024

We believe that while lending diversification leads banks to lend more in normal times (especially for banks over $50B in assets) and does benefit the general economy, community banks should be careful in how and where they choose to diversify. It is hard to achieve geographical diversification within a bank’s footprint.

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South State Correspondent

MAY 15, 2024

We believe that while lending diversification leads banks to lend more in normal times (especially for banks over $50B in assets) and does benefit the general economy, community banks should be careful in how and where they choose to diversify. It is hard to achieve geographical diversification within a bank’s footprint.

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American Banker

NOVEMBER 11, 2024

With plans to open 100 banking centers in "banking deserts," the $3 trillion JPMorgan Chase is arguably the nation's largest community bank. Other big banks should take notice and follow suit, and regulators should encourage them.

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