Windows of Opportunity

Miami-Dade is one of the largest deposit markets in the nation, and the county’s community banks have been attractive acquisition targets for larger banks over the years, including international banks. Spanish banking giants, for example, acquired three of the county’s most prominent community banks: TotalBank, City National Bank and Sabadell United (formerly Mellon United).

Although much decision-making and leadership at all three banks has been kept local, the acquisitions have helped open up opportunities for smaller community banks.

“There’s a void in the market right now for people that want to deal with a bank that’s going to listen to them and that’s going to find ways to get creative and make a deal,” says Raul G. Valdes-Fauli, president and CEO of Coral Gables-based Professional Bank. “That’s where community banks are going to scoop up market share.” Valdes-Fauli joined the single-branch bank a year ago, after a two-plus decade career with larger banks.

Others in the industry agree that there’s a shortage of healthy community banks in the county. Most consider BankUnited too big to be a community bank, and its private equity owners have been hinting that the bank is ripe for acquisition. U.S. Century Bank and Great Florida Bank were both making serious runs as multi-branch community banks but both had to deal with their own capital needs and bad loans. St. Petersburg-based C1 Bank acquired U.S. Century in August.

Coconut Grove Bank, another well-known community bank, was suffering similarly until recently, when a group of local investors poured additional money into the bank. Eddie Arriola, chairman of three-branch Apollo Bank, says there’s more than enough business to go around for the county’s community banks. He’s focused on taking business from nationals like Bank of America and Wells Fargo, and even from City National, which has 26 branches and is rapidly expanding.

In a way, the numerous opportunities are community banks’ biggest challenge, Valdes-Fauli believes. He says it can be tempting to become overaggressive and to stretch on loan terms and pricing when competing for business against the big banks. “Miami has come back so fast that I think staying disciplined and staying prudent and not repeating the mistakes of the last financial crisis is a challenge,” he says.

County Share of State Deposits

Tags: Miami-Dade, Southeast, Banking & Finance