The mid-year growth rate of financial institutions in the Colorado Springs area slowed to the lowest level in three years, but the statistic says more about major declines at two banks than it does about the area's economy.
Area deposit growth fell to 4.9 percent, the lowest since deposits increased 3.7 percent in 2013. Banks and credit unions operation in the area reported $12.2 billion in deposits as of June 30, up from $11.6 billion on June 30, 2016, according to reports from the Federal Deposit Insurance Corp. and the National Credit Union Administration. Local deposits grew 6.1 percent last year, the fastest rate in four years.
The slowdown in deposit growth is almost entirely related to major declines in deposits at Academy Bank and ANB Bank. Deposits at the 45 other institutions operating in the area rose by 8.4 percent.
Academy Bank reported a drop of nearly $217 million at its downtown Colorado Springs branch and an increase of more than $290 million at a branch in the Kansas City, Mo., area. according to data from the FDIC. Academy Bank CEO Paul Holewinski said "deposits that were corporate in nature" were moved to Kansas City as part of the headquarters move.
Tom Ashley, regional president for ANB Bank in southern Colorado, said the bank lost $130 million in deposits from a government agency he declined to name to an entity that is not insured. ANB's deposits in the Springs area fell $119.3 million, meaning the bank attracted more than $10 million in other deposits from the area.
"This is good news because without those two banks, we had an 8.4 percent increase and that is consistent with the other local economic data I am seeing, including economic output, employment growth and new business formations," said Tatiana Bailey, director of the University of Colorado at Colorado Springs Economic Forum.
Other information from the reports:
- Credit unions grew at four times the rate of banks with deposits jumping 9.2 percent to $4.3 billion, while bank deposits edged up 2.3 percent to $7.9 billion. Banks still hold nearly two-thirds of all local financial institution deposits.
- Statewide, bank deposits rose 5.8 percent to $132.6 billion. Statewide, credit union deposits increased 6.6 percent during the same period. Nationwide, bank deposits were up 5.2 percent to $11.9 trillion, while credit union deposits were up 8.2 percent to $1.15 trillion. Deposits in all U.S. financial institutions increased 5.5 percent to $13 trillion.
- Branch networks at local financial institutions remained unchanged from a year ago at 179 offices at mid-year, while the number of bank branches operating statewide declined 1.7 percent to 1,492. Nationwide, the number of branches fell 2.2 percent to 89,838, the fewest since 2004, as more customers moved to online banking.
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