HSBC Group Holdings plc bills itself as the world”™s local bank ”“ and Fairfield County”™s wealthy jet set appears to be bearing the motto out.
Between this past June and a year earlier, HSBC more than quadrupled deposits to $150 million, making it by far the fastest-growing bank locally according to the new data from the Federal Deposit Insurance Corp. Half of HSBC”™s local deposits are registered to its downtown Stamford branch near the city”™s corporate district, one of 10 new branches the bank has added locally in the past two years.
Meanwhile, Connecticut”™s two largest homegrown banks continued to lose standing in their own backyard on the FDIC report, although experts surmised that industry deposits since then have likely ballooned as investors cashed out stocks in favor of the relative security of bank deposits and as the government increased FDIC insurance limits on deposits.
Waterbury-based Webster Financial Corp. reported a 12 percent drop in Fairfield County deposits as of June, while Bridgeport-based People”™s United Financial Inc. saw local deposits erode 3 percent to below $5 billion, the fourth straight year deposits have dropped and the first time since 2003 they have been below the $5 billion mark.
The two banks led the county in percentage drop in market share, at 0.7 percent and 0.65 percent, respectively. In neighboring Westchester County, however, People”™s United racked up $83 million in deposits at three new branches, its first in New York state.
The county”™s homegrown banks had mixed records. Fairfield County Bank Corp. of Ridgefield, the second largest after People”™s United, enjoyed a 9 percent boost in deposits. On the flip side, Bank of Greenwich had a 6 percent decline in deposits according to the FDIC, while Stamford-based First County Bank had a 5 percent dip.
Bank of America Corp. continues to fare poorly on the FDIC list for Fairfield County since acquiring Fleet Bank”™s former branches in 2004. The Charlotte, N.C.-based titan”™s deposits dropped 5 percent and its market share a half-percentage point ”“ for the first time in memory, the former Fleet branches held less than a 10 percent share of the wealthy Fairfield County market, and their market share was half the level of 2004.
The bank”™s Fairfield County results stand in stark contrast to its performance in the rest of Connecticut, however, where the bank reported a whopping $2.7 billion gain in deposits and 3.5 percent increase in market share. The company remains the runaway market leader with $15.2 billion in Connecticut deposits, or 19 percent of the state market.
Bank of America spokeswoman Tara Burke declined comment on the local performance of bank branches, including whether the FDIC figures in Fairfield County demonstrate a decline in business, or whether the data reflects deposits being shifted to branches elsewhere. More than two-thirds of Bank of America”™s Connecticut deposits are assigned to a Hartford office, and Burke said banks are allowed to shift deposits between offices.
On paper, the attrition of People”™s, Webster and Bank of America appear to have most benefited Charlotte-based Wachovia Corp. ”“ and by extension Wells Fargo & Co., which in mid-October appeared to have beaten out Citigroup Inc. in the two companies”™ bids to acquire Wachovia.
If Wells Fargo retains all of Wachovia”™s local branches, the San Francisco-based company would overnight become the second largest in Fairfield County after People”™s United, and the fastest growing among the largest banks doing business here. Across the border in Westchester and five other counties in New York”™s lower Hudson River valley, Wachovia displaced JPMorgan Chase & Co. Inc. as the market leader.
