Each year, the FDIC releases its annual Summary of Deposits report that provides a look at branch office deposits for banks across the U.S. The report details deposit market share, or percentage of deposits, an institution has within a defined geographic market. This year proved to be an exceptional year of growth and deposit market share for UMB Bank across our eight-state footprint.
This year, perhaps more than ever, I am proud to report that UMB once again ranked No. 1 in the Kansas City area‡ for deposits, holding 23% of the total market share. Leading our hometown in deposits is something we greatly value. Not only does this accomplishment represent the growth we have seen at UMB, but it also allows us to invest back into the community.
Deposits are the lifeblood of our organization and are vital to our ability to lend money to businesses and people in the community. Having the resources to invest in businesses, projects and other initiatives that drive a city’s progress is crucial to our role as a financial steward. And as the market share leader in Kansas City, we also have a responsibility to the community – a responsibility we work to fulfill each day through our civic engagement, volunteering, investments and more.
We’ve held the position as market share leader in Kansas City for nine years running, and we believe that it is because people trust UMB and feel confident keeping their money with us during all economic cycles. As history has shown, we tend to see positive business activity when there is a flight to quality during unpredictable times—and this year has showcased that once again.
Additionally, while we’re all adapting to a new way to conduct business, our pipeline and sales activity remain strong, and we continue to see growth across our various business lines. That growth was showcased in our most recent earnings report. As of September 30, 2020, UMB reported $24.7 billion in deposits and $16.0 billion in loan balances. This represents significant growth year-over-year when we reported $19.3 billion in deposits and $13.0 billion in loan balances at the end of Q3 2019.
As I recently discussed with the Kansas City Business Journal‡, the pandemic has greatly increased deposits across the board as consumers and businesses safeguard their money during these uncertain times. You can see this reflected in the numbers reported by the FDIC as of June 30, 2020. For UMB, this meant we ranked in the top five for market share in five cities within our footprint, including: Kansas City (No. 1)‡; Colorado Springs (No. 5 and the first time to be in the top five)‡; St. Joseph (No. 5)‡; Warrensburg (No. 5)‡; and Atchison (No. 3).
We also ranked in the top 10 for market share in other major markets, including: St. Louis (No. 10 and first time to be in top 10); Joplin (No. 9); Salina (No. 6); and Columbia (No. 10). In Dallas-Fort Worth‡, we are up 81% year-over-year versus the overall market growth of 28.2%, and in Denver, we experienced 40.9% growth versus the market growth of 22.3%.
What Lies Ahead
If we’ve learned anything from this past year, it’s that predicting the future is a futile exercise. However, based on what we know right now, we anticipate that cash will continue to be sidelined until we have more clarity about COVID-19 and how we can safely return to work, school and everyday living. We also anticipate a modest economic recovery as companies begin to regain confidence in the economy, more jobs are created, and as consumer sentiment steadily rises.
The dust from the recent presidential election is also beginning to settle. KC Mathews, our chief investment officer, recently noted that while politics create short-term noise, they have little to do with impacting long-term financial plans. He anticipates short-term market volatility for the remainder of the year but expects that we will see a significant rebound in 2021, with real GDP at 3.7%.
From a commercial lending standpoint, the impacts of the pandemic have been far reaching, with various industries and regions experiencing different outcomes. The economy will continue to fluctuate in the months ahead, but we believe businesses can prepare by being nimble, flexible and adaptable. The need to evolve quickly and strategically, with an eye on long-term goals, has never been more pressing as we look ahead to a somewhat uncertain 2021.
In the midst of everything happening in the world and in our country, one thing is certain – we are here and ready to assist. For more than 100 years, UMB has proven to be a strong financial steward for the communities we serve and for our customers. In the end, we believe people do business with us because they trust what we do and the counsel we provide. We look forward to continuing to serve our communities and customers for the next century and beyond.
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