BY KIM MOORE
A conversation with Craig Wanichek, president and CEO of Summit Bank.
BY KIM MOORE
A conversation with Craig Wanichek, president and CEO of Summit Bank
Driver behind eight consecutive quarters of double-digit loan growth
Most of our growth has come with our customers growing their lending needs. Our customers are mostly manufacturing and the traded sector. A lot of our customers saw 15% to 20% growth in their businesses last year and a little bit less the year before. As companies grew and made investments in their people and equipment or a new plant, they required lending to do that. That was a large portion of our growth.
{pullquote}The key is for a bank to have a couple of niches and perform them very well. {/pullquote}
How bank consolidation has helped
People like the local decision making that we have; they know when they come in with a loan request ,the decisions will be made by people they know, in their community, who understand their business. As banks get bigger, those decisions get made farther and farther away. People who are making the decisions don’t know the people or the businesses, or know the community.
Sector where you have seen the most growth
We bank so many different industries, it is hard to put a finger on one sector that has seen growth. For us it has been across a number of different manufacturing segments. In the Eugene-Springfield market, we had a lot of multifamily and student housing projects over the last couple of years that helped our local economy grow.
You experienced losses from real estate loans in 2010. How is that sector performing now?
We had some losses, but they were very specific to a couple of accounts. We have only seen improvement in that concentration of customers. The part that hurt most banks was in the acquisition, construction and development part of the real estate business, when the recession hit. Eugene-Springfield performed better than the nation as a whole because we didn’t have the bubble that ran up real estate values. We have a tailwind to continue the economic growth we have seen as new housing starts in our area have not come back to the levels they were prerecession.
Do you expect to consolidate yourself?
We are in the top decile of banks our size for return on equity. One of the areas that impacted a lot of community banks is the increased burden of regulation. The key is for a bank to have a couple of niches and perform them very well. They can be successful against the larger banks. We have really tried to target the small to medium community bank businesses, and 95% of our clients are business clients. That helped us abate some of the costs of that regulation.
Summit Bank, founded in Eugene in 2004, |
Possibility you will acquire or be acquired by community banks
We are focused on our strategic plan of staying a one-branch, local community bank. Part of the reason we have been efficient is that we only have one. While we just have one branch, it is a really big branch. We are able to do it because we have mobile banking, online banking, mobile capture. We have customers throughout the state because of this technology.
Competition from nonbank lenders
We have not seen a lot of competition from nonbank lenders. We don’t compete in the consumer segment, which is where there has been some competition. There is a certain size [of loan] where a person wants to meet with a banker and talk about their business. Below that, I think it will be very competitive with the nonbank lenders, with their online model — some smaller clients will go online to get their loans. For community banks, there will be the ability to team up with nonbank lenders and deliver the product through the bank in some sort of partnership.
Next technological revolution in banking
The near-field technology will have an impact on banking, like Apple Pay. It will change the way consumers pay for things. We will have the EMV chip put on the Visa card, which increases security. This technology has been used in Europe for years. United States card processors are having to get up to speed and update their processing to handle it. You’ll see tellers off-site who are on a TV screen — wherever you are, if you are at an ATM and need help, you can use that type of technology to get help. But the bigger revolution will be Apple Pay and the online platform for people to get loans, consumers to get mortgages, businesses to get business loans.
Click through to see an abridged power list ranking Oregon and Clark Co., Washington banks by deposits.
Abridged power list ranking Oregon and Clark Co., Washington banks by deposits
RANKED BY JUNE 30, 2014, OREGON AND CLARK CO., WASHINGTON DEPOSITS | ||||||
RANK | NAME | ADDRESS / PHONE | OR / CLARK CO. SENIOR EXECUTIVE(S) | OR/CLARK CO / TOTAL DEPOSITS | YR ESTAB / HQ CITY | OR/CLARK CO / TOTAL BRANCHES |
1 | U.S. Bank | 111 S.W. 5th Ave. Portland 97204 503.275.4289 | Michael Righi | $13.5B $263.7B | 1863 Minneapolis, Minn. | 211 3,238 |
2 | Wells Fargo & Co. | 1300 S.W. 5th Ave., 20th Floor Portland 97201 800.869.3557 | Tracy Curtis, Tom Taylor | $11.1B $1.034T | 1852 San Francisco, Calif. | 130 6,200 |
3 | Bank of America | 121 S.W. Morrison St., Ste. 1700 Portland 97204 503.275.1429 | Roger Hinshaw | $9.8B $1.046T | 1904 Charlotte, N.C. | 77 5,151 |
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