Evans Bancorp wasn't part of KeyCorp's deal for First Niagara Financial Group last year, but it still reaped the benefits, Evans president and CEO David J. Nasca said.
Twenty percent of Evans' new business in loans and deposits resulted from market disruption sparked by the Key-First Niagara deal, Nasca said. Overall, Evans generated record-high profits of $8.3 million last year, which Nasca highlighted at Thursday's annual meeting at the bank's Hamburg headquarters.
"We're surprised at the length and depth of opportunity that's continuing, and we think there's more coming," Nasca said of the market disruption's impact. The actual amount of new business Evans gained due to the deal could have been even higher than 20 percent, he said.
But Nasca said the true effect goes beyond numbers.
"I think it's created an opening in the market for us to deliver a broader brand perspective, such that people have recognized that there's still a local community presence making decisions in town, headquartered here," he said. "So it opened up the viewfinder a little bit for these folks to be able to say, 'Hey, there's another option.' That's the bigger win, I think, more so than even capturing customers, is that it gave us a bigger presence, a bigger platform and a bigger pulpit."
Evans had about 2 percent of the Buffalo Niagara region's deposit market share last year, ranking sixth, according to Federal Deposit Insurance Corp. data. But the bank, which has 265 employees, crossed the $1 billion asset threshold for the first time last year, and added a branch in Lockport. Nasca said the Lockport branch has "given us a great entry into a market that felt a little bit abandoned when First Niagara moved [its headquarters] to Larkinville."
Evans made a splash early this year when it raised $14.2 million in capital. Nasca called that a "very opportunistic raise that will assure that we have capital for the kind of growth that we're experiencing through the business plan and beyond, we believe."
"The purpose [of the additional capital] is organic growth," he said. "That eats capital, in terms of just what we're trying to do. It allows us to leverage that capital into increasing the size of the bank."
Meanwhile, the Buffalo Niagara banking field keeps getting more crowded, with new entrants and others ramping up their presence. Nasca said Evans is ready to contend.
"The reality is, we've been here for 97 years," he said. "We're locally headquartered. It's taken us 97 years to broaden out this base. I don't think people just drop in and say, 'OK, we're here now, you need a community bank,' because I think we're a pretty significant player that's very competitive."
"I don't think there's a lot of new business flying to the area," Nasca said. "There is some business startup. But the pie is not getting a whole lot bigger. And we believe that we have earned our right with these clients to serve their needs."
Evans has hired a chief risk officer, Dale McKim III, who will step into the newly created position June 1. He will join Evans from accounting firm KPMG.
Nasca said Evans felt it was a good time for the bank to add the position, based on the institution's growth, and that McKim was already familiar with Evans through some of his past work. "This is a guy that is really going to lift our game, I believe," Nasca said.