Local / Smaller Bank -how to find them? 17 posts by 7 users

Posted: 07/05/2008 at 04:33PM

Hi all...name's Jugo.

I'm just starting out, currently shopping for financing.

My question is to the Vets:

Upon searching for some LOCAL banks in the area, I was befuddled to find that most banks have more than ONE branch. Duh!
Okay, so I just want to know what classifies a LOCAL branch as being a LOCAL branch?

For example, do we look for Community Banks in the search? Banks with NO more than 5 branches in the State?

Thanks for the timely responses in advance...

Jugonian

Posted: 07/05/2008 at 08:03PM

http://www4.fdic.gov/IDASP/main_bankfind.asp

Here is the official place to find information on any bank. This will tell you branch's, asset size, everything you could ever want to know about a bank.

Posted: 07/06/2008 at 07:01AM

Yes, I agree, great link to learning more about local banks. Thanks!

From the liabilities section on a bank's balance sheet you can get a feel for how many nonperforming loans they may be carrying and how desperate they are for your mortgage business or to unload REO properties.

I'm going to talk to one of them on Monday...

Posted: 07/06/2008 at 03:10PM

Jugo,

Here's my take on reading the info on the FDIC site. If there are other finance-minded individuals, feel free to weigh in as well.

Go to that link.
Select a Charlotte zip code like 28202

Select First-Citizens Bank & Trust Company (not a small community bank but just for the example)

Click on " Last financial information"

Generate a report for the latest time period for Assets & Liabilities.

You get a bunch of info, some of which includes this:

Assets and Liabilities
7 Net loans & leases 8,785,744 8,270,638
8 Loan loss allowance 113,876 110,060

16 Total liabilities 12,618,469 12,190,700

Memoranda:
31 Noncurrent loans and leases 13,033 19,332

So this bank has net loans of $8.7 billion outstanding (a combination of lots of loan types, not just mortgages), and they're expecting losses on those loans of about $113.9 million. Then I skip down to line 31 and see that they've got $13 million in noncurrent loans - not a huge number compared to their total balance sheet, but if it were a small community bank that would indicate they may have a bunch of properties on hand from defaulted mortgages, i.e. REO's.

I found one community bank in GA that had a big number of noncurrent loans, which for a small bank can spell trouble.

Hope this helps, and good luck.

Posted: 07/09/2008 at 06:46PM

I am an IT Auditor for banks, so I have to frequent that site quite often to get information haha.

One thing I didn't mention before that I should have is that if you know a bank exists and they are not in that list, then you don't want them as a bank. This means that there is a high probability that they are not insured. If a bank is not insured there has to be a reason, and you can almost always be sure that reason is not one that is favorable to you...

Posted: 07/10/2008 at 06:28PM

Jugo,
Its very difficult to say...

How banks are is dependent upon the community they reside in among many other factors.

I would say that generally community banks are a lot less likely to sell their mortgages once they have made them. In this market that means that they are a little bit less strict on who they lend to and the terms they want because they have not been hit nearly as hard by the sub prime mess as most other banks.

At the same time, until you have built a relationship up with them they aren't just going to hand you money and say i don't care do whatever :P

Community banks are the way to go if you want to build a longer term relationship with the banker. Most community banks that I have audited have extremely low turn over. Many are now run by a guy who started as a teller and worked his way up through the ranks the old fashioned way. Now imagine if you were the guy who was making him look good as a loan officer and he is now the president... you are probably guaranteed just about anything you want from the bank.

Hope that helps!

Posted: 07/11/2008 at 01:02PM

Okay..great info Ash01. Thanks greatly.... 8)

I too, have been around the world of Mr. Whale Big Bank and have now come full circle. This gem is priceless....

Here in my part of NC, we have about 10-15 communtiy banks within a 15-20 mile radius of each other. Brilliant! God is good!

Based on your experience(s), can you give me some questions I need to ask the LO @ the local community Banks?
For example: (Do you sell your mortgages to other Big Banks? What programs do you offer, -HUD/FHA etc.?)

My plan is to VISIT these institutions in person next week, speak w/ them of MY plans of action, and just want to make sure I get the answers and results I want.

Thanks for the info again, and good living to you...

Jugo, USA
" Just crease, crumple; cram. You'll do fine."
-Newman (Seinfeld)

Posted: 07/12/2008 at 12:33AM

Back to the topic at hand...

You are going to need a name and a vector. Simply having a bank's main number is not going to cut it. You will have to have an in.

This is where you turn to your team. Ask your Realtor, Realtor's broker (boss), your lawyer, your insurance agent, your title company's closing agent, appraiser, other small business owners, etc. for a reference. Heck, your attorney and realtor's boss should be able to give at least 10 solid contacts.

I can't say this enough, you got to get the name of a AvP, or VP of commercial lending at that community bank. Small businesses that have been in business a while have a go to guy at a bank, get that go to guy's name and number and you are half-way there.

Next, you have to meet, share your " vision" and provide financials, but that is a story for a differ thread.

Posted: 07/12/2008 at 04:33PM

An additional question:

In light of the market downturn / frozen heloc's;

Are smaller/local banks the way to go for LOC's?

Thru online research I read that the BIGGER banks (Wamu,etc.) are freezing existing HELOC's like subzero and placing ballbusting restrictions on the new ones.
How can one avoid this calamity?

Jugoroian
" Be content to seem what you really are."
-Marcus Aurelius