RankingBanking 24 Digital (1) - Flipbook - Page 4
2
An Ode to
Community Banks
By Naomi Snyder
E
very year that Bank Director
cial deposits, that’s what they want.” Among the
publishes RankingBanking, an
largest 300 banks, the smallest institution ex-
analysis of the largest 300 public-
amined this year had $2 billion in assets.
ly traded banks by performance, I
RankingBanking is compiled by Piper San-
find myself marveling at the sheer
dler & Co. with year-end 2023 data from S&P
number of community banks that
Global Market Intelligence. It uses four metrics
top the list. This year was no ex-
to gauge the performance of public commercial
ception. Although there are some
and savings banks as defined by S&P. The met-
banks that have achieved success-
rics are core return on average assets and core
ful niche business models over the
return on average equity, tangible common equi-
years — The Bancorp and Bank
ty to tangible assets, and nonperforming assets
OZK are among them — what RankingBank-
to loans and other real estate owned. Each bank
ing proves is that the community bank model is
is ranked on each metric, and the sum of the
far from dead. In fact, it’s thriving. Take a look
rankings produces a final score. This year, total
at Five Star Bancorp in California and Great
shareholder return was excluded because some
Southern Bancorp in Missouri.
over-the-counter banks are thinly traded, mak-
As Bank Director’s Vice President of Edito-
ing the metric unfair as a comparison. Manage-
rial and Research Emily McCormick describes
ment teams also have a harder time influencing
on page 22, 19 of the top 25 banks in the coun-
that figure.
try last year had less than $10 billion in assets.
In 2023, bankers who were wise about bal-
Kara Baldwin, a partner who leads the financial
ance sheet management and dominated their
services audit group at Crowe LLP, which spon-
markets or niches did better than others. That’s
sors this report, says some of that performance
not to say that all small banks outperform larg-
has to do with a loyal customer base. “When
er banks — certainly not. But small overachiev-
something goes wrong, you can have a discussion
ers filled the top of the ranks. In these pages, we
with someone who actually knows you personal-
tell some of their stories.
ly,” she says. “You’re not getting sent to a call
center far off. And for a lot of these commer-
Naomi Snyder is editor-in-chief of Bank Director
