2An Ode toCommunity BanksBy Naomi SnyderEvery year that Bank Directorcial deposits, that’s what they want.” Among thepublishes RankingBanking, anlargest 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, IRankingBanking is compiled by Piper San-find myself marveling at the sheerdler & Co. with year-end 2023 data from S&Pnumber of community banks thatGlobal Market Intelligence. It uses four metricstop the list. This year was no ex-to gauge the performance of public commercialception. Although there are someand savings banks as defined by S&P. The met-banks that have achieved success-rics are core return on average assets and coreful niche business models over thereturn on average equity, tangible common equi-years — The Bancorp and Bankty to tangible assets, and nonperforming assetsOZK are among them — what RankingBank-to loans and other real estate owned. Each banking proves is that the community bank model isis ranked on each metric, and the sum of thefar from dead. In fact, it’s thriving. Take a lookrankings produces a final score. This year, totalat Five Star Bancorp in California and Greatshareholder return was excluded because someSouthern 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 describesment teams also have a harder time influencingon 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 financialance sheet management and dominated theirservices audit group at Crowe LLP, which spon-markets or niches did better than others. That’ssors this report, says some of that performancenot to say that all small banks outperform larg-has to do with a loyal customer base. “Whener banks — certainly not. But small overachiev-something goes wrong, you can have a discussioners filled the top of the ranks. In these pages, wewith someone who actually knows you personal-tell some of their stories.ly,” she says. “You’re not getting sent to a callcenter far off. And for a lot of these commer-Naomi Snyder is editor-in-chief of Bank Director
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