Spokane’s leaders have bemoaned the flight of corporate headquarters from downtown since Expo folded its tents in 1974. Well, in the case of the banks, anyway, that’s changing.
Last month’s announcement by AmericanWest Bancorp. that its headquarters will be moved to a new namesake building at Riverside and Browne brings to five the number of commercial banks clustered within a few blocks of Domini’s, home to Spokane’s unique, mustard-covered twist on power-lunching. The others are Washington Trust, Sterling Savings, Inland Northwest and Wheatland Bank, another newcomer. Together, they control about $2 billion in Spokane County deposits — more than 40 percent of the market — and hundreds of millions more in a footprint that extends eastward to Billings, Mont., and westward to Forks, Wash. Even once-dominant Old National Bank, merged into US Bank in 1987, never had so long or so strong a reach.
And of the five, only Washington Trust existed before Expo.
AmericanWest, founded in 1974 in Chewelah as United Security Bank, has become a $1 billion financial institution with branches from Yakima to Kellogg. Chief Executive Officer Wes Colley says the bank will move downtown from Northpointe because that’s where a bank must be if it wants to be perceived as a player in Eastern Washington. Big borrowers like a reassuring downtown presence, he says. Bank officers, on the other hand, will be able to more frequently rub shoulders with their competitors.
“I very seldom see those people,” Colley says. “You probably get a better feel for how they’re running their banks if you bump into them.”
You also get a better idea as to what deals are circulating in the community, he adds.
Wheatland opened for business in Davenport 25 years ago. Chairwoman Susan Pittman Horton says the bank’s headquarters was transferred into an inconspicuous third-floor suite in the Riverpark Properties Building at the corner of Wall and Spokane Falls Boulevard because officials want to build Wheatland into the dominant independent community bank.
Relocation was the most effective way to get the bank’s leadership involved in Spokane affairs, says Horton, herself a member of the Eastern Washington University, Spokane Area Chamber of Commerce and Downtown Business Partnership boards of directors.
She says Wheatland also wanted to help drive downtown redevelopment by funding projects like the Blue Chip Lofts condominium development. And despite its low physical profile, Wheatland has done very well building its deposit and loan portfolio. Building shareholder value will help keep the bank independent.
That, in turn, assures Wheatland can continue to serve the agricultural customers who were its bread and butter for years. Longtime agricultural customers sometimes express concerns that Wheatland will forget them, Horton says, who notes the Davenport branch is undergoing an extensive remodeling.
But to succeed in Spokane, Wheatland must be downtown.
“In our industry, it’s all about relationships,” Horton says. “People want to be known by name.” That meant being where those ties could be nurtured. Besides, she adds, employees and customers like having city amenities right outside the door.
Sterling has ballooned from a single branch on Wall Street to a regional giant with more than $6 billion in assets. With merger after merger, the company has added to its stature and to a work force that fills more and more downtown office space.
Suburban sprawl and the development of satellite communities have not stripped from downtowns their traditional role as the hubs of commerce, says Senior Vice President Heidi Stanley. If a bank wants to make a statement about its intention to be a force in the community, that’s where it has to be, which was the decision Sterling’s founders made at the outset.
As the bulk of Sterling’s business has shifted to the West Side, Stanley says, investors sometimes question whether Spokane is the right downtown for the bank. That should not be an issue as long as Sterling can serve customers as distant as those in Klamath Falls, Ore., she says.
Washington Trust has survived a legion of competitors over 102 years. Even though the bank has been a downtown fixture for all those years, and remains the city’s largest financial institution, President Pete Stanton says he is not sure the concentration of banks downtown is as important as it might have been 30 years ago.
Although having a critical mass of financial institutions helps the community, he says, intense competition has taken away some of the collegiality among bankers that was once possible. “Everyone’s a bit closer to the vest,” says Stanton, who nonetheless adds that local banks would no doubt work together if a project was important enough for the community.
With its market share more or less locked in at about 25 percent, Washington Trust has expanded by opening offices in other downtowns — Seattle and Boise.
“You go where the action is,” Stanton says.
For the smaller banks, that has meant Spokane. And even though the larger banks have looked elsewhere for growth, the city is stronger for that, as well.