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Commercial Lending Trends & Strategies 3rd Quarter, 2020
Assets < $300M 2017Q4 2018Q2 2018Q4 2019Q2 2019Q4 2020Q1 2020Q2 LOAN YIELDS
Loan Growth Rate 3.79 7.49 3.45 6.26 1.87 0.58 20.18
Loans / Assets 63.44 64.18 64.69 65.62 64.76 63.93 62.73
Deposit Growth Rate 5.33 -2.95 5.68 -1.18 6.10 4.72 31.45
Loans / Deposits 74.90 76.14 77.39 77.93 76.67 75.95 74.50
ROA 0.76 1.07 0.98 1.09 0.96 0.96 1.07
ROE 6.62 9.41 8.52 9.03 7.87 7.95 8.87
Equity / Assets 10.97 11.08 11.15 11.76 11.69 11.67 11.17
NPLs / Loans 0.78 0.75 0.71 0.68 0.68 0.65 0.65
LLR / Loans 1.26 1.27 1.25 1.25 1.25 1.28 1.24
Loan Yields 5.36 5.40 5.59 5.66 5.68 5.55 5.57
Cost of Funds 0.47 0.53 0.67 0.79 0.81 0.77 0.62
Loan Yld / Cost Spread 4.89 4.87 4.92 4.87 4.87 4.78 4.95
>$300M and <$1B
Loan Growth Rate 9.31 6.23 9.30 5.50 6.57 3.85 3.46
Loans / Assets 71.19 71.55 72.54 72.52 72.48 71.92 71.29
Deposit Growth Rate 0.63 5.35 1.34 6.88 1.71 5.37 6.88
Loans / Deposits 84.22 85.10 85.90 86.06 86.03 85.32 84.77
ROA 1.02 0.79 1.17 1.12 1.17 1.11 1.01
ROE 9.49 7.47 11.09 10.51 10.49 9.76 8.91
Equity / Assets 10.57 10.50 10.42 10.60 10.96 10.99 10.96
NPLs / Loans 0.94 0.87 0.80 0.78 0.76 0.77 0.75
LLR / Loans 1.25 1.23 1.22 1.21 1.21 1.20 1.23
Loan Yields 4.98 5.05 5.15 5.36 5.44 5.40 5.27
Cost of Funds 0.47 0.52 0.62 0.80 0.92 0.92 0.86
Loan Yld / Cost Spread 4.52 4.53 4.53 4.56 4.52 4.48 4.41
>$1B and <$10B              
Loan Growth Rate 11.83 8.33 9.66 6.97 8.10 5.71 6.31
Loans / Assets 73.94 74.44 75.16 75.16 75.02 74.54 73.97
Deposit Growth Rate 3.48 6.94 3.67 6.44 4.04 6.17 7.31
Loans / Deposits 89.43 90.44 91.38 91.17 90.85 90.59 89.93
ROA 1.04 0.70 1.23 1.21 1.23 1.19 0.92
ROE 9.70 6.64 11.55 11.06 11.00 10.54 8.27
Equity / Assets 10.51 10.54 10.64 10.82 11.05 11.18 11.05
NPLs / Loans 0.84 0.77 0.71 0.71 0.69 0.64 0.66
LLR / Loans 1.11 1.09 1.08 1.05 1.05 1.03 1.13
Loan Yields 4.63 4.74 4.86 5.07 5.14 5.08 4.90
Cost of Funds 0.45 0.50 0.64 0.82 0.96 0.88 0.80
Loan Yld / Cost Spread 4.18 4.24 4.22 4.25 4.18 4.20 4.10
source: S&P Global Market Intelligence (commercial and savings institutions < $10B in Assets; median data)
ARTICLES and RESOURCES
What Can Community Bankers Learn from Large Bank CECL Disclosures?

Towards the end of the first calendar quarter for CECL adoption, the Coronavirus pandemic struck, beginning a downward slide in business activity fueled by a rapid rise in unemployment caused by the lockdown of a significant portion of the US economy. As a result, financial institutions of all sizes, whether using CECL-based metrics, (large banks), or the traditional Annual Incurred Loss methodologies, (ALLL), (smaller institutions), began increasing their provision for credit loss estimates. 
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INDUSTRY TRENDS
 
Assets < $300M
 
                     
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
>$300M and <$1B
 
                     
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
>$1B and <$10B
 
                     
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
                       
source: S&P Global Market Intelligence (institutions < $10B in assets; median data)
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