U.S. Bank, Wells Fargo dominate Twin Cities banking market

U.S. Bank, Wells Fargo hold two-thirds of area’s deposits

Excerpt:

Twin Cities businesses and individuals are saving more - just like their peers all around the country - and that’s fueling some big increases in bank deposits in the region.

And that’s pretty good news for most banks.

The Federal Deposit Insurance Corp.’s annual tally of deposits and market share in metro areas around the country showed an 18.4 percent year-over-year increase in Twin Cities deposits as of June 30, pushing total deposits to $90.7 billion.

Many banks are sharing in the gain, with some of the biggest local growth coming at the Twin Cities two banking giants, Wells Fargo Bank and U.S. Bank.

Those two longtime market leaders continued to hold almost 66 percent of the region’s deposits at mid-year. Their combined share is up from 60 percent a year ago.

Wells Fargo Bank continued to be the No. 1 deposit gatherer, holding more than 37 percent of the region’s savings, or $33.8 billion.

U.S. Bank’s deposits grew 28 percent to $25.9 billion.

Those figures reflect an environment where both consumer and business customers are holding on to their cash, waiting for their markets to recover or their job prospects to solidify before they start investing again or spending on big-ticket items.

Comment: TCF Bank and M&I Bank are the region’s third and fourth largest banks

Top 5 Banks

Top 5 U.S. banks

Excerpt:

Assets Total equity Tier 1

in billions ratio*

Bank of America $2.3 trillion $233 11%
Charlotte, N.C.

J.P. Morgan Chase $2.0 trillion $171 12%
New York

Citigroup $1.9 trillion $155 12%
New York

Wells Fargo & Co. $1.2 trillion $121 10%
San Francisco

U.S. Bancorp $283 billion $29 10%
Minneapolis

*Compares bank capital to risk of its assets. Well-capitalized banks have a Tier 1 Capital Ratio of 6 percent or more.

Comment: More on US Bank

Big deal ahead for U.S. Bancorp?

Excerpt:

Since Davis took the helm of U.S. Bancorp in 2007, the Minneapolis-based bank has acquired four small banks and thrifts with combined assets of $35 billion -- far less than some of his big-bank counterparts. Davis avoided a major deal while Bank of America, J.P. Morgan Chase, Wells Fargo & Co. and Pittsburgh-based PNC Financial Services all made headline-grabbing acquisitions that, in some cases, enabled them to double in size.

Yet even Davis, a CEO known for his caution, seems to be warming to the idea of a larger transaction. At a conference last week, Davis promised investors he would not miss an opportunity to do a deal if a good one came along. "If it's small or big, if it's bank or payments or trust, we will not miss a single opportunity," he declared.

Though Davis later tempered his remarks, saying he would "be just fine" if U.S. Bancorp did not do a major deal, his comments set off speculation that a large transaction might happen by year's end. Wall Street analysts rattled off a long list of banks with depressed market values that would make for likely takeover targets. They include SunTrust Banks Inc. of Atlanta, Regions Financial Corp. of Birmingham, Ala., KeyCorp of Cleveland, Fifth Third Bancorp of Cincinnati and Zions Bancorp of Salt Lake City.

Comment: We've had 2 banking relationships with US Bank. 1st was a Visa Buxx card that we used to give money to our daughter when she was in college; 2nd was our mortgage. Positive experiences with both.