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Big or small, Maryland banks try to stand out in market

In competition for customers, institutions extend special offers, new services

Atlanta-based SunTrust Bank, with 1,500 branches in seven states, including Maryland, recently launched e-Savings, a plan that allows customers to open separate fee-free savings accounts for individual projects.

Sandy Spring Bank, the Olney-based bank with 49 branches in Maryland and Northern Virginia, has built financial services packages designed for specific groups, such as veterans and public service workers, dentists and small businesses.

Lutherville-based Bay Bank, a community bank with nine locations, has run special rate campaigns to attract borrowers.

Whether large, small or somewhere in between, banks in Maryland are coming up with new services and special offers as a way of surviving and thriving in what all agree is a competitive market.

Industry experts say the banks’ efforts are driven by a variety of factors, from the historically low interest rates to well-capitalized banks looking to make loans to increasing competition from unusual sources. But probably the most important factor, they say, is consumers’ demand to take advantage of all the latest technologies.

“It’s as competitive as it’s ever been,” said Sandy Spring Bank Senior Vice President Mark Slatin. “There are so many choices — more outlets than there ever have been to turn to have your banking needs met. … The choices out there seem to be endless.”

“What’s most different these days is consumer preferences, particularly on how they want to interact with their institution,” said Kathleen Murphy, president and CEO of the Maryland Bankers Association. “Much of that is driven by technology, and technology is so dynamic today.”

For example, she said, people wanting to make a deposit can do so in person, at an ATM, online and even, for businesses, through remote capture deposits.

“Banks now have to provide a variety of products and relationships that customers can access anytime, anyplace,” Murphy said.

In addition, banks must compete with other companies that have started offering financial services — such as PayPal, Google and Apple.

“As these other engines are coming in, banks are constantly having to look at how they are providing services and resources for their customers,” Murphy said.

Sandy’ Spring’s Slatin noted that State Farm Insurance, for example, now offers car loans.

“Technology has made it easier for different types of companies to add on to products and services that were their core,” he said.

A recent survey by the American Bankers Association indicates the importance of offering cutting-edge options but also of maintaining more traditional means of banking.

The annual survey of customer preferences, released in August, found that the country’s top preferred banking method since 2009 has been the Internet (favored by 31 percent of respondents). But branches (preferred by 21 percent) remain in second place and actually increased in popularity since last year (from 18 percent). ATMs (14 percent) remain in third place, but mobile devices continued to rise and are now preferred by 10 percent of consumers.

According to ABA Senior Vice President Nessa Feddis, the increased popularity of banking in person has prompted a “bank renaissance in some areas, with many banks transforming their branches to become more efficient and customer-friendly.”

Murphy said several Maryland banks are “sprucing up” their branches, and one, SunTrust, has transformed some branches into financial education centers.

Sam DiPaola, SunTrust Bank’s president for Baltimore and Annapolis, said the banking industry has always been competitive, but that competition is driven by different factors at different times.

DiPaola said via email that customers today “want better service along with convenience,” which explains the “significant growth in the mobile channel and online banking to augment business conducted at branches.

“We’re constantly talking with our clients about their needs and looking at new technology that might be able to help us meet those needs,” DiPaola said. “… But ultimately they want the option of all service channels available for their use.”

Besides the now-typical array of technological options, SunTrust has initiated its e-Savings program, which allows users to set up separate savings “buckets” for different savings goals. SunTrust also created SummitView, an online “financial planning solution” that uses “cutting-edge account integration technology to give clients “an unprecedented view of their total financial picture,” DiPaola said, and an online business guide aimed at developing a customized guide for businesses.

Sandy Spring’s Slatin also said competition means knowing what customers are looking for. To that end, he said, Sandy Spring Bank recently held several half-day focus groups, bringing in clients to find out what is most important to them in the banking process.

Although all banks try to cater to their clients’ wishes and offer the latest technology, different banks play to different strengths, depending in part on their size and resources. Bay Bank, only 4 years old and with only nine branches, pushes its “service and our nimbleness,” said Kevin Cashen, president and chief executive officer.

“The biggest thing we do is try to speed to market,” he said. That means, for example, getting customers quick answers on loans.

Murphy said the traditional diversity of the state’s banking industry — Maryland has 1,724 branches and 121 banks with branches, according to the FDIC — also ensures a lively competition for consumers.

“These are banks of all shapes and sizes,” she said. “It provides a lot of choice for consumers.”

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