Worcester Business Journal

wbjournal.com | February 21, 2022 | Worcester Business Journal 15 TITLES? MUST BE OUR NEW ENGLAND PEDIGREE #1 Credit Union SBA Lender in MA, for the 7 th year in a row. We're proud to serve local businesses as one of the hardest-working lenders around. Find out how our competitive rates, SBA expertise, and pride in small business make the difference. Get in the game with us: call or visit today. 508-490-6779 and www.stmaryscu.org/winningloans B A N K I N G & F I N A N C E F O C U S consolidating. From 2011 to 2021, the total number of Massachusetts banks declined by 34%, even while the total dollar value of their assets increased 66%, according to FDIC. Community banks' most competitive advantage is their focus on service and relationship building, Bartholomew said. "ere is a want to do business with community banks because they can get things done quicker. You can tell your story to the president of the bank, maybe get someone to listen to you, versus a large community bank. Yet, they [bigger banks] are able to do larger transactions, so there is a place for both," he said. Cultural alignment Regardless of asset size, all banks serve a unique function and are all a pivotal part of the American economy, said Ed Manzi, chairman and CEO of Fidelity Bank in Leominster, which has $1.2 billion in assets. "Assuming all banks are the same is like saying all restaurants are the same because they sell food," he said. e world of community banking fac- es both cyclical challenges, such as the natural rise and fall of the economy, and secular changes, such as the technologi- cal transformation of financial services, Manzi said. Staying current with the latest advancements is a costly necessity, espe- cially for smaller banks. "You have a lower market business while you're growing and spending money to continue to meet the clients' needs," Manzi said. Overhead capital is spent on hiring talented professionals for clients who prefer traditional teller services, while also investing in digital capabilities. In order to sustain escalating costs, com- munity banks need to constantly grow in order to stimulate cash flow. Fidelity Bank itself has completed three acquisitions over the past six years with Barre Savings Bank in 2016, Co- lonial Co-Operative Bank in 2018, and Family Federal Savings in 2020. e leadership of each merged bank were thoughtful about the future and were culturally aligned with Fidelity Bank, said Manzi. "e best way that they could think of, in the long term, to help the clients, communities, and colleagues that their bank cared about was to join a bank like ours that was bigger, to join forces with, and have the extra resources to continue to invest in its communities," he said. Selecting partnering banks who support the same mission is key to a sustainable acquisition. e merged banks were attracted to the bank's values of helping clients reach their individual financial goals. "We think it is a privilege to be a bank and to help people with their financial decisions and that privilege spills over trying to improve the quality of life in the communities that these folks live in," Manzi said. Pitts from Bay State, in echoing the personalized service offered by commu- nity banks, sees the entirety of the bank- ing industry from a holistic perspective instead of one focused on competition, a place where banks run by Mr. Potter and George Bailey could co-exist. "Harmony exists, and it is a good thing. You have a choice to make, we'd like it to be with us, but if not, that is okay too because we are all here, no matter what, whenever you need us, we will still be here with your support," Pitts said. Fewer banks, more assets Mass. banking institutions 160 135 107 Mass. banking employees (full-time equivalents) 45,696 51,018 49,809 Mass. banking assets $307 billion $394 billion $512 billion Mass. banking institutions with less than $100M in assets 19 9 2 Employees of Mass. banking institutions with less than $100M in assets 431 206 80 Total assets of Mass. banking institutions with less than $100M in assets $1.4 billion $763 million $152 million Source: Federal Deposit Insurance Corp. 2011 2016 2021 W

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