1. For most community banks deposits are the major funding source. Deposit management over the last four years has been relatively easy as interest rates have remained at historical low levels. This is likely going to change in 2016 as short-term interest begin to increase.
A. Evaluate your bank’s deposit market share in your primary market [use your main offices and if you have branches the two largest branch locations]. Who are your principal competitors? {This data can be found on the FDIC web site under Deposit Market Share. Please use FDIC Certificate #23286 Fall River Five Cents Savings Bank. Also use the UBPR. Copy and paste below}
https://cdr.ffiec.gov/public/SelectReportFormat.aspx?reportType=283&idrssd=833404&ReportPeriod=6%2f30%2f2015&Name=FALL+RIVER+FIVE+CENTS+SAVINGS+BANK
B. How aggressive is deposit pricing in your market and who are the price leaders? [The market is Southeastern Massachusetts or the Fall River Massachusetts area, Bristol County].
C. Analyze the inflow of deposits at your bank since January 1, 2011. In the analysis include both the amount of inflow and the distribution between core deposits and certificates. (Please refer to link again UBPR)
D. What recommendations would you make for deposit pricing once interest rates start to increase? Comment on both pool pricing (MMDA & Savings) and certificates
2. Let’s focus on local trends. Community banks lend locally and therefore the state and the local economy is important.
A. Do an analysis of your state economy(Massachusetts). What is the unemployment rate in your area (Southeastern Massachusetts or the Fall River Massachusetts area, Bristol County)and how has it trended in the last two years.
B. What are the major industries in the state(Massachusetts)?
C. What is the state of the housing market? Commercial real estate lending?
D. Future deposit growth? Can your bank grow loans & deposits at 3%, 5% 7% in your state?
E. What is the nature of your local economy(Southeastern Massachusetts or the Fall River Massachusetts area, Bristol County)?
F. What is the demographic outlook long-run for the state and local area?
3. Economies of scale or size are increasing across the banking industry.
A. What is the relationship between a bank’s asset size and the following income statement items?
1. Net interest margin
2. Fee income
3. Operating expenses
B. What factors are making it more difficult for small banks to prosper?
C. Relate economies of scale to your institution? How large to you believe an institution needs to be 
to handle the current pressures in the market place?
D. How many banks were in existence in 2010? 2012? 2014? Do you see a trend and will the trend 
continue?
E. Is there a future for community banks under $500 million?

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