Mammoth shift: Financial players are navigating a new world of innovation and sustainable growth

Mammoth shift:

Financial players are navigating a new world of innovation and sustainable growth

For a growing number of banking and finance institutions, there’s no place like Raleigh-Durham. Considering that 65% of the area’s graduates stay after graduation, 70% population growth is projected by 2046, a 1 million-strong regional workforce, the fourth-highest concentration of Ph.Ds in the country and the lowest corporate tax rate in the United States at 2.5%, the Raleigh-Durham region is an investment no-brainer and a boon for banking and finance entities.

Based on key metrics including price-to-rent ratio, cost of living, corporate tax rate, prices per square foot, state income tax and talent, the Raleigh market is best positioned to take advantage of the current business climate, trends in entrepreneurship and venture capital flows, according to WRAL.com’s TechWire citing a Silicon Valley Bank study of regional markets across the country. To illustrate its attractiveness, the area’s crown jewel, the Research Triangle Park, attracted $11 billion in new investments and 18,000 new jobs in the middle of the pandemic.

It adds up to a ripe environment for a sector that also benefits from being close to Charlotte, the nation’s second-largest banking hub. Landscape Throughout 2020, Raleigh-Durham’s Top 25 banking players collected an aggregate $63 billion in deposits, a testament to the Triangle’s capacity to attract capital even amid the uncertainty triggered by the pandemic. Truist, Wells Fargo and PacWest Bancorp are the Top 3 banks by deposits in the region, with an aggregate $35 billion, representing close to 55% of the Triangle’s banking market share. Raleigh-based banks on the list include First Citizens Bancshares, TowneBank and North State Bank with a total $8 billion in deposits and a 12.4% market share. Durham’s M&F Bancorp also made the list, with $163.3 million in deposits and a 0.25% market share.

From a state lens, Federal Deposit Insurance Corp’s (FDIC) latest Quarterly Banking Profile (March 2021) showed net income at North Carolina banks soared 70% in 1Q21 compared to 1Q20. The net income of the state’s 47 financial institutions totaled $8.12 billion in the quarter, close to double the net income of 1Q20, which was $4.77 billion. North Carolina banks also bolstered their equity capital to $293.33 billion, a 4.6% increase from 2020 and a 19.1% gain from 2019.

Some examples of banking and finance growth in the region include Fifth Third Bank, which has set the ( )