By the numbers – Mega Banks vs. Community Banks
There are 44,000 banks and credit unions around the world. While 28 of those banks have over $1 trillion dollars in assets serving audiences globally, the vast majority of these financial institutions are smaller organizations focusing on providing catered financial products to small communities.
Customers in the United States have the highest number of options in the world when selecting an organization to bank with. The United States houses over 11,000 registered banks (FDIC) and credit unions (NCUA). These US based financial institutions collectively have over $19 trillion dollars in assets and provide banking services to over 300 million financially active Americans.
These banks and credit unions have a broad array of specialties, focusing in areas such as commercial lending, consumer mortgages, indirect auto lending, and high yield products. They also vary significantly in their size from national/multinational banks with branches in every major metropolitan area to the smaller community banks which focus on niche markets. Let’s take a closer look at these two key types of banks.
Nationals / Multi-national Banks
The largest 20 banks in the United States manage almost 50% of the countries deposits including 4 banks with over $1 trillion in assets. These massive institutions serve customers in every state and have approximately 37 thousand branches across the country. National banks invest heavily in their digital channel. In fact 3 large banks are on the Alexa list of the top 50 most traffic websites of 2017 getting more traffic than sites such as Quora, MSN, and FoxNews.
Community/Regional Banks
Community Banks vary significantly in range from $2M in assets with 1 branch focusing on a single audience segment to larger organizations with over $100B in assets and focusing on multiple similar audiences across multiple states. Community banks have over 52,000 locations across the country and hold over $5 trillion in assets.
There are important strengths and weaknesses when it comes to the size of a bank. The large national banks may lack the nimbleness of a community banks while community banks often fall behind in investments in areas such as digital platforms and innovation labs. Let’s take a closer look at how these two categories of banks differ on the digital channel.
Search Engine Optimization
For many banks, search engines such as Google yield the largest supply of new customer opportunities. Americans search for all types of financial products hundreds of millions of times each month. Extractable uses tools such as MOZ and SEMrush to monitor how banks of all sizes appear in search results for popular financial products.
When it comes to gaining traffic from search engines, large banks can sometimes outmaneuver their smaller competitors by investing heavily in important search signals such as content marketing and external links/mentions. This type of Search Engine Optimization can work well for certain types of competitive phrases. When we look at search impressions for highly competitive products such as auto loans, CDs, and mortgages we find that large banks are getting 2X-9X the search traffic as community banks.
| % of Search Results by Org Type | |||
| Search Pharse | National/Multinational Banks | Community/Regional Banks | Other Sites |
|---|---|---|---|
| auto loans | 50% | 0% | 50% |
| used car loan | 50% | 10% | 40% |
| refinance rates | 50% | 0% | 50% |
| car loans | 40% | 0% | 60% |
| certificate of deposits | 30% | 0% | 70% |
However, as Google continually optimizes their search algorithms we are starting to see search signals such as geographic proximity have higher relevancy thus allowing community banks to appear higher in search results for certain types of phrases.
| % of Search Results by Org Type | |||
| Search Pharse | National/Multinational Banks | Community/Regional Banks | Other Sites |
|---|---|---|---|
| local bank | 10% | 70% | 20% |
| free checking | 20% | 60% | 20% |
| home loan | 20% | 30% | 50% |
| high yield savings | 0% | 10% | 90% |
| mortgages | 0% | 10% | 90% |
Mobile Applications
Almost every US bank and credit union has a mobile application in the Apple App Store and Google Play. From our analysis, the size of the bank does not have a correlation with the ratings score of the mobile applications. But the size does have an obvious correlation with the number of downloads and reviews.
Investments in Technology
When it comes to technology platforms banks of all sizes have to support hundreds of different applications by a large variety of vendors. On the public marketing sites banks utilize platforms such as Web Content Management Systems (CMS), onsite search engines, calculators, and web analytics to offer virtual banking services to prospects and customers. When we look at the technology investments in large banks we see certain vendors such Adobe are often used to help marketers easily manage large websites.
| Bank | Content Management System | Web Analytics (Primary) | Primary Framework / Techs |
|---|---|---|---|
| JPMorgan Chase Bank, National Association | Adobe | Adobe | J2EE |
| U.S. Bank National Association | Adobe | Webtrends | .Net |
| PNC Bank, National Association | Adobe | Adobe | .Net |
| TD Bank, National Association | Adobe | Adobe | .Net |
| SunTrust Bank | Adobe | Adobe, GA | .Net |
| HSBC Bank USA, National Association | Adobe | TeaLeaf | Multiple |
| Fifth Third Bank | Adobe | YA, Multiple | Multiple |
| Chase Bank USA, National Association | Adobe | Adobe, GA | Multiple |
| Capital One, National Association | Contentful | Adobe, GA | PHP |
| State Street Bank and Trust Company | Drupal | GA | Multiple |
| Charles Schwab Bank | Drupal | Adobe | Multiple |
| Wells Fargo Bank, National Association | SDL | Adobe | J2EE, PHP |
| Branch Banking and Trust Company | TeamSite | Adobe | J2EE |
As we look at the technologies that community and regional banks utilize for their public marketing sites we see a much broader list of vendors including companies such as Kentico, Sitecore, and Episerver. While Adobe Analytics dominates with the larger banks, almost all mid to small size banks are using Google Analytics to analyze visitor behaviors.
| Bank | Content Management System | Web Analytics (Primary) | Primary Framework / Techs |
|---|---|---|---|
| Wintrust Bank | Adobe | Adobe | Multiple |
| Woodforest National Bank | C1 | GA | .Net |
| Mechanics Bank | DNN | GA | PHP, .Net |
| First Bank | DNN | GA | .Net |
| Beneficial Bank | DNN | GA, Adobe | .Net |
| First Bank | DNN | GA | .Net |
| First Foundation Bank | Drupal | GA | PHP |
| Flushing Bank | Ektron | GA | .Net |
| OneWest Bank | Ektron | GA, Adobe | .Net |
| Westamerica Bank | Joomla | GA | Multiple |
| Central Pacific Bank | Kentico | GA | .Net |
| East Boston Savings Bank | Kentico | GA | .Net |
| ConnectOne Bank | Kentico | GA | .Net |
| Luther Burbank Savings | Silverstip | GA | PHP |
| TCF Bank | Sitecore | GA | .Net |
| Hanmi Bank | SiteFinity | GA | .Net |
| NBH Bank | WordPress | GA | Multiple |
When we look at the platforms powering online banking platforms (OLB), Loan Origination Systems (LOS), and Online Account Origination (OAO) we continue to see a wide variety of platforms such as Fiserv (Corillian), Kony, D3, FIS, Alkami, nCino, BottomLine Technology, and MeridianLink.
As the relationship between banks and customers continues to become more digital, banks will no longer be judged by the number of branches, the proximity of branches, or the number of open tellers. Technologies such as voice recognition, digital assistants, and artificial intelligence driven personalization will start to blur the perceived lines between large multi-national banks and smaller community banks from the customer’s point of view. Customers of all types are putting more emphasis on finding financial institutions that offer customer service through advanced technologies rather than branch locations. Large banks will continue to invest heavily in new digital service offerings and community banks will more quickly deploy, test, and optimize increasingly accessible digital platforms. The digital future will provide rich opportunities for new customer acquisition and customer service online and banks will use the strengths of their organization’s size to implement technologies in ways suiting to their relative audiences.
Extractable continuously analyzes data to understand how banks and credit unions can better serve customers. Some of the data points referenced in this article come from the following data sources.
Data Sources:
- BankFocus, Moodys
- FDIC Banking Study Reference Data (2018)
- ICBA
- NCUA
- World Council of Credit Unions
- Statista
- BuiltWith
- NCUA