With the number of bank failures increasing, we frequently get asked how our customer base is holding up. Our informal observation has been that our customers have held up well and if anything we've seen our base get stronger. We finally did some research to validate this observation and found the results to be unequivocal: Over the last few years, Andera customers have been involved in 115 merger or takeover transactions, of which 109 were on the acquiring side.
This means Andera customers are overwhelmingly strong and getting stronger, and are the ones taking advantage of market turmoil to grow in this challenging economy.
To explain this, one theory is that by definition, Andera customers value deposit relationships and generally tend to use their deposits to fund loans. The banks that are failing (of course I'm generalizing here) have been the ones who have funded their loans with high cost liabilities, brokered deposits, or hot money - NOT the ones who have focused on core deposit growth.
This all reinforces the position that online account opening is a low cost channel to acquire high quality core deposits (and by extension, an enabler of success in tough times), and the results speak for themselves.