M&T Bank and KeyCorp dominate the local banking landscape with a combined deposit market share of about 82 percent in the Buffalo Niagara region. But don’t assume their rivals will concede the market. Here is how they aim to compete:
Bank of America
It’s second only to JPMorgan Chase among the largest U.S. banks measured by assets, so it has vast financial resources to draw from. Bank of America promotes its national presence as another advantage, making it easier for customers to do business with the bank around the country. Locally, it has about 25 branches, one of the largest totals of anyone serving the region.
The bank also plays up digital services customers can tap into, and resources like Better Money Habits, which offers financial education and advice to manage their spending and achieve savings goals. It also has teams from Bank of America Merrill Lynch to work with its commercial clients.
Northwest bolstered its presence last year, buying 18 area First Niagara branches. John Golding, Northwest’s New York region president, said the bank is large enough to provide the technology tools customers expect to manage their bank accounts and to cover the territory with branches.
“But they’re small enough to still be operating as a community bank,” Golding said. Golding sees a void in the marketplace left by the purchase of First Niagara. “I think we fill it perfectly.”
Citizens plays up its accessibility. More than half of its Buffalo-area branches are in Tops supermarkets, with customer hours seven days a week, said Paul Taffe, president of Citizens Bank in New York. The bank also offers services like Citizens Checkup, giving customers a chance to sit down with a banker for financial advice.
“Our commercial bank has been increasingly active in the Buffalo market with traditional commercial and industrial lending, as well as related asset-based lending and leasing,” Taffe said.
Even with two banks controlling more than 80 percent of the deposit market share, it’s still a large market with $42 billion in deposits in Erie and Niagara counties, said David J. Nasca, Evans’ president and CEO. Even small increases in market share, he said, can be a major growth for a bank starting from a small base. The bank’s focus is not being one of the big guys.
“It’s being a small, nimble, locally headquartered, full-service community bank that focuses on relationships, not just transactions,” Nasca said. The bank has surpassed the $1 billion asset mark and finds it already “punches above its weight class” in competing for business, Nasca said. “We can compete on the terms of those big-bank products, with a small-bank approach or a small-bank attitude.”
Bank of Akron
CEO Peter Forrestel said his bank is well-positioned for a couple of reasons. “Community banking is all about relationships, personal relationships with consumers and business owners and managers,” he said. “In our case, we just keep doing what we’ve been doing for 116 years.”
At the same time, he said, he sees a high rate of industry “churn,” with smaller banks being sold to larger ones and other banks combining branches. That has brought more customers into Bank of Akron’s doors, he said. “We’re noticing that customers are giving us a bigger piece of their business,” Forrestel said. “They’re saying, ‘I want to be with somebody who’s going to be around.’ ”
Alden State Bank
Alden is prepared to open a third branch in the market in Clarence. Richard Koelbl, the CEO, said the bank is small enough to relate to customers on a personal level, but can provide the digital services customers expect nowadays. “The cost of technology has come down so far that I think we compete very well on that level,” he said. “What we do is manage people’s information.”
Lake Shore Savings Bank
Lake Shore is based in Dunkirk and has a 15 percent deposit market share in Chautauqua County, ranking fourth among 11 institutions. Even before the market shakeup caused by the Key deal, Lake Shore strived to increase its 0.4 percent market share in Erie County, where it has six branches. The bank just celebrated its 125th anniversary and plays up its local relationships and hometown ties, but says it also has the digital tools customers expect.
Five Star Bank
Warsaw-based Five Star has made no secret of its desire to build up its market share in both Rochester and Buffalo and has taken significant steps in both regions. Its parent, Financial Institutions, acquired the Scott Danahy Naylon insurance agency in Amherst and Courier Capital Management, with offices in Buffalo and Jamestown, to diversify its sources of fee income and build customer connections. Five Star is about to open a branch at Fountain Plaza in downtown Buffalo, enhancing its presence in Erie County.
Community has “all the financial services the bigger banks offer,” has local decision makers and products like free checking and no-closing-cost mortgages, said Hal Wentworth, senior vice president for retail banking. “We provide our customers with easy access to banking services with online banking, mobile banking, telephone banking and direct deposit,” he said.
Bank on Buffalo
The newest entrant in town plans to start with three branches. The bank hopes to attract businesses ranging from mom-and-pops to companies with about $100 million in revenues. With that base, it wants to pick up retail customers from the owners and employees of those companies. Bank on Buffalo is also playing up its local decision-making and its ability to draw on the financial backing and history of CNB Financial Group, which has $2.5 billion in assets.