2019 Journal of Community Bank Case Studies

2019 COMMUNITY BANK CASE STUDY COMPETITION

19%

People’s Intermountain Bank has specific goals set in growing commercial and industrial in both loans and deposits (Williams). C. Asset Growth For the past decade, People’s Intermountain Bank has had consistent asset growth. Over the last 10 years the bank has seen growth of 149% in assets. At the beginning of 2017 it had $1.53 billion in assets and by the beginning of 2018 it had total assets of $2.0 billion (FFIEC). Along with organic growth, the bank received excess capital for investing from its IPO. In October of 2013, Bank of American Fork merged with Lewiston State Bank creating People’s Intermountain Bank. Lewiston State Bank had a total of $257 million in assets at the time of the merger. Additionally, in 2017 they realized a gain in assets from an acquisition of seven branches of Banner Bank and a merger with People’s Town and Country Bank. The acquisition of Banner Bank totaled $260 million in acquired assets. The merger of Town and Country Bank contributed an additional $135 million in assets. In the last year the bank’s total assets increased a subtle 2.8% due to integration of the merger and acquisition along with new management. Not only are assets growing, but asset quality has been improving. Over the last five years there has been a percentage decrease in delinquent loans of 0.4% and non-performing assets of 1.4%. People’s Intermountain Bank has been conservative in asset quality compared to its peer group historically. This is primarily achieved through strategic management of the loan portfolio.

44%

325%

Construction C&I Single Family Multifamily Farmland & Ag Consumer CRE

756%

287%

17%

166% 79% 64% 17%

10%

5% 4% 1%

The bank’s strategic diversity manages risk while maximizing profitability. Commercial real estate (CRE) loans are the leading category followed by construction, commercial and industrial, and single-family residence (FFIEC). The State of Utah is the third fastest growing state in the nation (Clarke). In 2018, the population growth rate was 2.2% which was just below 2017 at 2.3% (Perlich). Much of that growth is realized in southern Utah and the communities surrounding the bank’s headquarters. This has provided great opportunity for People’s Intermountain Bank to capitalize on CRE and construction loans as many people are migrating and business development is at a historic high. The loan composition is carefully monitored and strategically managed as the bank maintains compliance with regulations, while pursuing profitability and customers’ needs. The State of Utah is expected to continue in growth of population and economic opportunity. People’s Intermountain Bank expects loans to continue to grow organically, as well as through acquisitions and mergers.

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