In a competitive banking landscape, American Business Bank (OTCQX: AMBZ) has emerged as a standout performer, securing the 9th position among 225 banks in S&P Global Market Intelligence’s inaugural deposit rankings for institutions with assets between $3 billion and $10 billion.
The rankings, which evaluate banks based on eight key metrics, place a premium on noninterest-bearing deposits, considering them the most valuable assets for financial institutions. This focus is particularly relevant given the challenging environment created by the Federal Reserve’s aggressive rate hikes since early 2022.
Leon Blankstein, CEO and Director of ABB, attributed the bank’s success to its strong relationships with small to middle-market operating companies and the dedication of its banking team. “Our fortress deposit franchise is built on loyal client relationships and talented bankers,” Blankstein stated.
As of the end of 2024, ABB demonstrated strong financial performance with total assets of $4.04 billion and a cost of deposits of 1.33%. The company maintained a healthy asset quality, with nonperforming assets and loans 90 days or more past due accounting for only 0.18% of total assets. ABB also experienced solid growth in its deposit base, reporting a $147 million increase in total deposits, representing a 4.2% rise.
These figures underscore ABB’s solid performance in a period marked by significant shifts in deposit dynamics across the banking industry. Since the end of 2021, noninterest-bearing deposits have plummeted by nearly 30% industry-wide, while interest-bearing deposits have grown by approximately 8%.
S&P Global’s new ranking system introduces a novel metric to assess the operational costs associated with maintaining deposit franchises, providing a more comprehensive view of bank performance beyond traditional measures.
This recognition comes at a time when the banking sector faces increased scrutiny following the 2023 banking crisis, which highlighted the critical importance of deposit stability. By excelling in areas such as noninterest-bearing deposit concentration and deposit efficiency, ABB has demonstrated its resilience in a high-rate environment.
The broader context of these rankings reveals a competitive landscape where community banks are vying for recognition. In the large community bank category ($3B-$10B assets), Stride Bank led with an impressive 88.8% noninterest-bearing deposits, followed by First Community Bankshares and Amalgamated Financial Corp at 50.10%.
As the banking industry continues to navigate challenges posed by economic uncertainties and regulatory pressures, ABB’s strong showing in these rankings positions it as a bank to watch in the coming years.
