Some experts predict the gradual demise of traditional community institutions, squeezed by changed consumer habits, fintech threats and big-bank dominance. It's a bleak outlook for a big piece of the industry. Bank and credit union executives and other commentators say smaller players do have a shot ... if they adapt quickly.
In a press conference in November 2019, FDIC Chair Jelena McWilliams reported that community banks had another positive quarter in the third quarter. Net income rose and the annual rate of loan growth at banks up to $10 billion in assets outpaced the overall industry.
Despite that, in a podcast in January 2020, McWilliams said that “generally the viability of the community banking model is a huge issue for them.” She mentioned such challenges as rural depopulation, succession planning, and lack of scale to deal with cybersecurity as among the reasons. Looking ahead ten years, the FDIC chair saw two scenarios for community banks.
