Houston area banks last year benefited from a rebound in the local economy and held their own against larger national competition while preparing for an increase in earnings from rising interest rates.
The rebound in the energy industry didn’t hurt, either.
“Our oil and natural gas industry customers have typically been in business for many years riding out the cycles,” said H. E. “Tim” Timanus, Jr., chairman of Prosperity Bank. “With the rise in prices of the commodities that drive this industry, our customers are doing well, which is clearly a benefit for our bank.”
Prosperity was among the local banks where deposits increased at least 10 percent last year. Others included Allegiance Bancshares of Houston, Woodforest Financial Group of The Woodlands, and the Galveston-area’s Texas Independent Bancshares and Moody Bancshares, according to data compiled by Chronicle.
Allegiance Bancshares made the largest jump in rankings by dollar volume of local deposits, rising to No. 7 from No. 11 on the last year’s list. While much of this leap was due to its acquisition of CBTX, the parent of CommunityBank of Texas — the acquisition was approved in May — the two banks deposits rose 10 percent between 2020 and 2021.
“The Houston regional economy is more resilient than people sometimes realize,” Allegiance Bancshares CEO Steven Retzloff told analysts on a January earnings call.
Granted, big national banks such as JPMorgan Chase, Wells Fargo, Bank of America. and PNC Financial Services Group maintained their positions as the four largest banks by local deposits. New York-based JPMorgan Chase and San Francisco-based Wells Fargo last year boosted local deposits by 13 percent and 20 percent respectively, while Bank of America, based in Charlotte, N.C., increased local deposits by 12 percent.
JPMorgan maintained a 22 percent market share of local deposits, while Wells Fargo advanced its local market share to 14 percent from 13 percent last year.
“It’s an exciting time for Houston,” said Johnathan Edgeller, JPMorgan Chase’s Houston region manager for commercial banking. “The ‘Silicon Bayou’ has become a major growth area with technology firms moving their headquarters or opening up strategic offices to support Houston’s energy industry.”
Still, the financial sector must cope with uncertainty created by Russia’s war in Ukraine, rising energy and commodity prices, and the Fed’s shift to inflation fighting.
“But,” added Edgeller, “Houston has proven time and again its ability to adapt and thrive, and we’re working with our clients to make sure this is no exception.”
Source: houstonchronicle.com
