Industry Outlook 2006 - Banking
Bankers are looking forward to a solid year ahead.
Florida bankers will be watching a new fed chairman learn the job, something they haven't done for 18 years. But with earnings and capitalizations solid and doing business in what Benjamin C. Bishop Jr., chairman of Jacksonville-based investment banking firm Allen C. Ewing & Co., calls "the perfect retail banking market," 2006 looks to be another good year for the industry here.
HIGH-PRICED: Valuations are so high, says Benjamin C. Bishop Jr., chairman of Allen C. Ewing & Co., that acquisitions should taper off.
Indeed, the market is so perfect that the values of banks have been rising to the point that they may deter acquirers. Bishop expects a slowdown in acquisitions this year.
In international banking, executives are encouraged that U.S. regulators have adopted a uniform approach to implementing the Bank Secrecy Act, designed to curb money laundering. Bankers worried about the prospect of conflicting interpretations by regulators. Meanwhile, non-U.S. residents fearful of kidnappings and economic and political instability in their home countries -- and taxes at home -- still worry the act opens their personal finances to unwanted scrutiny.
Seno A. Bril, general manager in Miami of BNP Paribas and president of the Florida International Bankers Association, says that with Miami serving as Latin America's main airport and financial center and the place where the region's kids come to college and their parents come to get medical care and shop, south Florida should continue to do well, though, he says, "It is a competitive market. Nothing will come easy. We are professional worriers. A lot will depend on the economic development in Latin America."
|"The biggest issue" in banking in 2006 is new fed Chairman Ben Bernanke."There's still a lot of uncertainty over how good of a job he'll do."
Number of new banks and thrifts chartered in Florida:
Year -- # of New Banks
1999 -- 23
2000 -- 10
2001 -- 8
2002 -- 4
2003 -- 11
2004 -- 10
Through July 2005 -- 5
Source: SNL Financial
For more information: snl.com
Florida bank merger and acquisition activity:
Year -- # of Mergers/Acquisitions
2004 -- 19
2005 -- 13 (estimate)
2006 -- 9-10 (projection)
Source: Allen C. Ewing & Co.
Alan Levan's move to position BankAtlantic as Florida's most convenient bank with extended hours seven days a week is resulting in 15,000 new accounts a month and 25% to 30% annual growth in total deposits. "We have been growing at an extremely rapid clip. We expect that to continue." He's also chairman and CEO of homebuilder Levitt Corp., which also owns Core Communities in St. Lucie County.
HURRICANE FACTOR: Insurance reimbursements and rebuilding funds are flowing into consumer accounts, leading to home equity loan growth as recipients leverage the money for renovations and improvements.