In 2023, Silicon Valley Bank and First Republic Bank faced failures, leading to a tumultuous year for the banking industry reminiscent of the 2008 crisis. However, some small community banks like City Holding Co., the parent company of West Virginia’s City National Bank, seemed unaffected by the chaos. Despite being based in Charleston, West Virginia, a region known for coal and experiencing a declining population, City National Bank’s president and CEO Skip Hageboeck saw this as an opportunity rather than a setback. While major banks neglect reinvesting in West Virginia and surrounding towns in states like Virginia, Ohio, and Kentucky, City National Bank has steadily grown its market share by focusing primarily on retail banking, resulting in only 17.5% of its deposits being uninsured.
City National Bank’s approach to banking has proven successful, with only $894 million out of $5.1 billion in deposits being uninsured, as compared to the national average of 41% for all U.S. banks. This success has allowed City National Bank to compete effectively for customers in the region. Hageboeck’s strategy of prioritizing retail banking over catering to businesses has paid off, positioning the bank as a reliable and secure option for individuals seeking financial services. This focus on serving the community has set City National Bank apart from larger competitors, allowing it to thrive even amidst industry turbulence.
While the failures of major banks in 2023 sent shockwaves through the banking industry, smaller community banks like City National Bank remained resilient. By focusing on retail banking and reinvesting in the communities they serve, these banks have been able to weather the storm and even grow their market share. In a state like West Virginia, where larger banks have largely neglected to invest, City National Bank’s approach has allowed it to establish a strong presence and build trust among customers. This success serves as a reminder that, in an industry marked by volatility, a commitment to community and a focus on retail banking can be a winning strategy.
As City National Bank continues to thrive in the aftermath of the banking industry’s upheavals in 2023, its success has drawn attention from industry experts and analysts. With a focus on providing reliable and secure banking services to its customers, City National Bank has positioned itself as a standout example of how small community banks can excel in a challenging environment. By maintaining a conservative approach to managing deposits and prioritizing the needs of individual customers, City National Bank has been able to distinguish itself in the marketplace and solidify its reputation as one of America’s best banks in 2024. Its unique strategy of focusing on retail banking rather than catering to businesses has not only proven successful but has also become a model for other community banks looking to thrive in a competitive industry.
Looking ahead, City National Bank’s success serves as a beacon of hope for other small community banks facing challenges in the aftermath of the 2023 banking crisis. By staying true to their mission of serving their communities and prioritizing retail banking, these banks can navigate uncertain waters and emerge stronger. As the banking industry continues to evolve, banks like City National Bank stand out as examples of resilience and adaptability in the face of adversity. With a strong foundation built on trust, reliability, and a commitment to customer service, these banks are well-positioned to not only survive but thrive in an ever-changing landscape.
