While the largest retail banks in the U.S. heavily market their colorful smartphone apps and urge customers to manage their finances online rather than visit a branch in person, the largest community banks in San Diego say their success hinges on taking the opposite approach — knowing their customers personally through one-on-one visits at the bank or even at customers’ offices.
It’s not that the local banks don’t offer online banking; virtually all of them do in one form or another. They just tend not to market their Web-based services as much or invest in it as heavily as their national counterparts do.
Granted, the target market for a community bank is different than that of a major national financial institution such as Wells Fargo Bank or Bank of America; for starters, many of the local players in San Diego focus more on serving small-business customers than the personal-banking consumer.
Take, for example, California Bank & Trust, the largest bank with headquarters in San Diego, with $2.7 billion in local deposits. The bank — which advertises in newspapers, radio, billboards and online — in July rolled out a free mobile banking app that customers can download to their iPhone or Android device to view account balances, search recent account activity or transfer funds.
But you wouldn’t necessarily know that if you scanned a marketing piece from the bank.
In the Right Place
“Our key message is that we’re known for building long-term relationships with clients,” said Susan Brown, marketing manager at California Bank & Trust. “Our bankers live here in the community and have a very deep understanding of the regional economy. And that allows them to be much more effective at what they do.”
The same goes for Security Business Bank of San Diego, the seventh-largest local bank with $193.6 million in local deposits. There, executives go even a step further — they rarely even place advertisements. “We don’t have the budget like Chase to spread ads everywhere,” said President and CEO Paul Rodeno. “For us, it’s mainly word of mouth. We’re very referral driven. We rely on our referral network of CPAs and lawyers and we do a lot of work in the community with business-focused associations.”
Security Business Bank, as its name implies, works almost exclusively with business clients. Rodeno said the bank has a “high-touch” philosophy. “We want to know how our clients’ business operates so we can help them make the best decisions on their strategic issues.”
He said the bank is tech-savvy in a way that benefits its clients. It uses the Automated Clearing House electronic network to process payments for businesses and offers a popular remote deposit capture service that allows business clients to scan checks from their office and automatically deposit them into their accounts.
“Our volume in remote capture continues to go up; we saw a 15 percent increase last year,” Rodeno said. “People are still using checks. The whole notion of the paperless society isn’t quite materializing as fast as everyone thought it would.”
Many of the local banks offer their business clients the so-called “remote capture” check-scanning service. Among them is Torrey Pines Bank, the third-largest community bank based in San Diego with just over $1 billion in local deposits. There, marketing manager Crystal Watkins speaks not about high-tech gadgets or high-density branches, but about the importance of knowing the customer and the community.
“Technology is a great resource, but our biggest strength is our team of local bankers who’ve been in the market for 20-30 years and know the ebbs and flows,” Watkins said. “If people are looking for a branch on every street corner, that’s not us.”
Torrey Pines Bank, along with many other community banks — including Regents Bank, the fifth largest in San Diego — compensate for not having many branches by participating in the MoneyPass ATM program, through which customers can withdraw money without any fees at any MoneyPass ATM.
Getting the Big Picture
Technology, or the lack thereof, also comes into play when lending decisions are made, Watkins said. Rather than using an automated process for approving or denying loans, “we still have a loan committee and a management team evaluating the quality of the customer’s credit,” she said. “Our bankers look at the whole picture.”
Indeed, local decision-making is also a major factor that local banks say set them apart from national competitors.
“We keep that local autonomy,” Brown said of California Bank & Trust. “Our bankers are entrenched and ingrained in the local community, and that’s a bonus for our customers.”
