November 28, 2013

Community Bank Outlook

KPMG has released the results of its 2013 Community Banking Outlook Survey, which summarizes the sentiments of more than 105 CEOs and other senior executives of regional and community banks.  This a rich source of information, and I encourage you to read the full report.  Here are the highlights:

Optimistic about Revenue

Two-thirds of respondents predicted an improved overall economic outlook in 2014, and 85 percent expect higher revenues.

Getting a Handle on Regulation

Fifteen percent said that regulatory changes would require the most time, energy, and resources from management (versus 27 percent last year). 

Forty-two percent identified regulatory and legislative pressures as a primary obstacle for growth (down from 47% last year). 

M&A Predictions (Again)

Sixty-five percent expect their bank to be involved in a merger or acquisition over the next year (buy or sell side).

The primary reasons for deals are regulatory reform, geographic expansion, and access to new markets.

Seventy-seven percent of the community bank executives surveyed believe the minimum asset level a community bank must achieve to remain independent is at least $1 billion or more.

Cybersecurity & IT

Forty-six percent of community banking executives said they would increase spending on IT (46 percent)

You can read the full report here.

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