🔒NBT Bank records largest deposit market share jump in CT; banks overall see slow growth

New York-based NBT Bank, following its August 2023 purchase of Salisbury Bank, saw the largest deposit increase in Connecticut over the past year, according to newly released federal data.

NBT Bank, which is owned by publicly traded NBT Bancorp, grew its Connecticut deposit base by nearly 955% from June 30, 2023 to June 30, 2024, according to Federal Deposit Insurance Corp. data. 

The bank held $497 million in Connecticut deposits at the end of June, up from $47.2 million a year earlier. It is now the 32nd largest bank in the state in terms of Connecticut deposits held. 

Overall, banks showed little Connecticut deposit growth over the past year, as the high interest rate environment continued to encourage customers to chase the highest yields, including from online lenders and other non-traditional financial institutions. 

Banks operating in the state held $167.7 billion in Connecticut deposits as of June 30, up less than 1% from the year-ago period. 

That’s still an improvement from the previous year, when banks saw their Connecticut deposits shrink by about 7% from June 30, 2022 to June 30, 2023, FDIC data shows. 

Bank of America remains the state’s deposit market share leader with $37.6 billion in deposits, down 5.14% from a year earlier. It controls 22.4% of deposits in the state, down from 23.75% in June 2023. 

However, Stamford-based Webster Bank is closing in on Bank of America’s market share lead. It grew its in-state deposit base by 11.2% over the past year to $36.6 billion. It now controls 21.8% of deposits, up from 19.7% in June 2023. 

M&T Bank ranks third in the state and saw its deposit base contract by 2.75% from June 30, 2023 to June 30, 2024. It narrowed its deposit market share losses from a year earlier, when it reported a 22% decline in Connecticut deposits, following technical and other issues that arose following its $8.3 billion takeover of People’s United Bank in April 2021.

Meantime, Connecticut banks also closed a net 3.2% of their branches over the past year, as they continue to focus on beefing up online services, FDIC data shows. 

M&T Bank led the way with a net 22 branch closures. It now has 118 branches in the state.

NBT Bank had the most branch additions (four), following its Salisbury Bank acquisition. It now has six branches in Connecticut.