Citizens Financial CEO Says Regional Banks Can Compete

Regional banks can compete with the bigger banks.

So said Citizens Financial Group CEO Bruce Van Saun on Tuesday (April 25) when speaking with Bloomberg’s Baystate Business Hour Podcast.

“We go up against the megabanks every day in these markets like Boston,” Van Saun said. “We can win jump balls on deals against JPMorgan and BofA [Bank of America] and we do it on a consistent basis.”

The bank’s stock has dropped about 36% since early February in the wake of the failure of Silicon Valley Bank that made investors wary of other regional banks, Bloomberg reported Wednesday (April 26).

Van Saun said during the podcast that Citizens Financial Group “is fine” at its current scale and size and that he doesn’t see a need to combine with other banks to compete, according to the report.

If the Federal Deposit Insurance Corp. (FDIC) were to take over other failed banks, though, Citizens Financial Group has the capital to make acquisitions and would consider doing so if “there’s something interesting there,” Van Saun said.

One factor that could require regional banks to combine is regulation — something Van Saun said may increase after the recent bank failures because regulators “will think that they have to do something,” per the report.

“If there’s a significantly higher cost of doing business, then at that point there might have to be a reassessment,” Van Saun said.

PYMNTS reported April 19 that Citizens Financial Group latest quarterly results show that its period-end deposits were down 4.7% quarter over quarter but up 12% year over year.

The company has said that consumer deposits were about 67% of its firm-wide deposit base; quarter-end insured/secured deposits at roughly 68% of total deposits.

Several regional banks ended the first quarter with stable deposits, after a period in which the collapses of three banks led investors to closely watch the deposit flows at other smaller banks, Bloomberg reported April 20.

These results came despite the fact that regional banks were disproportionately affected by the collapse of Silicon Valley Bank that touched off a deposit flight to the presumed safety of financial giants thought to be “too big to fail.”