DUNKIRK – As the banking market in the Buffalo Niagara region continues to shake out from the Key Bank-First Niagara deal, Lake Shore Savings Bank is stressing its local roots – and some rivals' out-of-town background.
"We continue to capitalize on merger-related disruptions in the Western New York marketplace and focusing on the fact we are a local bank, operated locally, and that new entrants to the market area are really headquartered in Pennsylvania or Ohio," said Daniel Reininga, Lake Shore's president and CEO, at the bank's annual shareholders meeting on Wednesday.
Reininga was referring to the expanded local presence by Pennsylvania-based Northwest Bank, as well as the arrival of Pennsylvania-based CNB Bank, through its Bank on Buffalo division. Ohio-based Key has ramped up its existing Buffalo presence through the First Niagara deal.
Lake Shore is a small competitor in the region, recording profits of $3.4 million last year. Its total assets crossed the $500 million mark for the first time last year. The bank has emphasized growing commercial loans, and Reininga said that focus has paid off. Lake Shore recorded commercial loan growth of 30 percent in 2017.
"It's the right kind of interest, shorter-duration yields," Reininga said. "We're still in the residential market, we're still originating residential loans. It's a growth of the portfolio together."
Another sign of the bank's emphasis on commercial loan growth: The bank has pledged to give Jeffrey M. Werdein, executive vice president of its commercial division, a $1.4 million lump-sum payment if he is still with the bank as of March 2028.
Reininga said the bank's commercial loan growth this year is "ahead of plan. It's robust. It's a good pipeline."
Lake Shore has 11 branches in Erie and Niagara counties, the most recent of which opened five years ago. Reininga said the bank remains open to opportunities to add to that network, but had no announcements on that front.
Bank officials meet regularly with Lake Shore's millennial advisory board, to get feedback on how best to serve customers in that demographic. One project the members have helped with: researching other banks' websites to contribute to a redesign of Lake Shore's own website.