Midsize banks are more focused on growing small business deposits in 2023 than they were last year, according to a survey by Cornerstone Advisors of executives at financial institutions ranging from $250 million to $5 billion in assets. Among bank respondents, 72% cited growing small-business deposits as a high priority for the year ahead, compared to 41% last year. Fifty-one percent said growing retail deposits would be a high priority, compared to 21% last year. At the same time, fewer respondents listed growing income from commercial treasury management and debit and credit card interchange fees as top priorities, although all dropped by a only few percentage points.
The current interest rate environment was a major concern for most bank executives, with 53% listing it as one of their top worries. Other top concerns were the cost of funds (43%), the ability to attract qualified talent (42%), regulatory burden (36%) and cybersecurity (also 36%). Still, most respondents were optimistic about what 2023 holds for the banking industry, with 43% saying they were pessimistic about the year ahead.
