2019 Journal of Community Bank Case Studies

2019 COMMUNITY BANK CASE STUDY COMPETITION

HVCRE as % Capital

loans. People’s Intermountain Bank feels confident in its diversity and management within each sector of HVCRE to be above the suggested level, although it is accompanied with additional scrutiny from regulators. E. Liquidity Deposits are a new area of focus for People’s Intermountain Bank. The bank is aggressively seeking to grow business deposits through the addition of a treasury management team. In a conference call regarding the deposits, Len Williams stated, “We’ve already experienced some positive trends with the treasury services team bringing in more than $25 million in deposits since we hired the team a quarter ago” (Williams). Another competitive strategy for increasing deposits currently is offering a 2% annual interest rate, paid out quarterly as an initiative for customers (Allen). The bank faces the competition of interest rates from large credit unions in Utah who are not subject to income taxes, allowing

Industry Avg.

Bank of American Fork

160

140

120

100

80

60

40

20

3/1/15

6/1/15

9/1/15

3/1/16

6/1/16

9/1/16

3/1/17

6/1/17

9/1/17

3/1/18

6/1/18

9/1/18

12/1/14

12/1/15

12/1/16

12/1/17

12/1/18

Loan to Deposit Ratio

Bank of America Fork Peer Group

90.00%

89.15%

88.49%

88.00%

86.90%

86.00%

85.00%

83.85%

84.00%

81.94%

82.00%

80.10%

79.66%

80.00%

78.78%

78.78%

78.00%

Percentage 76.00%

74.00%

72.00%

2014

2015

2016

2017

2018

Year

as well as within the hospitality sector, resulting in the sale of a $7 million hotel loan at par. “We sold a $7 million hotel construction loan as we actively reduced our hotel loan concentration by 12%, to $56 million overall, which is well within our guidelines” (Williams and Olsen 2). Through strategic portfolio management the bank maintained the appropriate levels of capital to justify its aggressive position with

them to pay higher interest rates to depositors. Over the last 10 years, People’s Intermountain Bank has grown its deposits 162% and 100% in the last four of those years (FFIEC). The large increase in the latter years is primarily due to the acquisition of Banner Bank and the merger of Town and Country Bank.

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