Community banks told analysts at the Gulf South Bank Conference that the institutions are focused on growth, implementing new technology, discovering new revenue sources and dealing with an increased regulatory burden.
Though banks have already lost more than $1 billion as a result of the Durbin Amendment, there could be further losses in the future. The Mississippi-based Hancock Holding Co. could lose $2 million in revenue in the third quarter as a result of the Durbin Amendment, which caps the amount a bank can charge to process a debit transaction, according to NOLA.com.
Hancock said that the bank plans to look for new ways to make up the lost revenue, including ushering customers from low-yield deposit accounts to lower-cost accounts like checking where there is a better opportunity to gain revenue.
Another strategy that banks plan to use involves expansion. Hancock plans to expand in Texas and Florida. Hancock CEO Carl Chaney said that the bank has plenty of merger and acquisition opportunities in both states, NOLA.com reports.
The Louisiana-based IberiaBank Corp. has acquired five failed banks from the FDIC and is currently in the process of acquiring its fourth live bank to further grow the financial institution.
Iberia Senior VP of Financial Strategy and Mortgage John Davis said that the stressed economy and low-interest rate climate is difficult for banks. Davis further said that as a result of the current economic and mortgage woes, Iberia expects more banks to disappear in the next six years, paving the way for future acquisitions.
“There’s more pressure for consolidation now than we’ve seen in the past,” Davis said, according to NOLA.com.
The Louisiana-based MidSouth Bancorp Inc. increased its assets by 40 percent over the past year as a result of several acquisitions, including Beacon and Jefferson Bank. MidSouth has hired a senior VP of mergers and acquisitions to spearhead the bank’s move towards growth.
MidSouth CFO Jim McLemore said that as financial regulations continue to be implemented, the bank has hired an ombudsman to advocate for the bank’s customers.
“We think what we have in place will address what’s coming,” McLemore said, NOLA.com reports.