Megan Brooks
There are several independent banks in the US, including Independent Bank, which has branches in Michigan, Memphis, TN, and Alabama. Independent banks offer a range of financial services, including personal and business banking solutions. The Independent Community Bankers of America (ICBA) is an organization that supports and promotes independent community banks across the country. As of the first quarter of 2025, there were 3,917 commercial banks and 545 savings and loan associations in the US insured by the Federal Deposit Insurance Corporation (FDIC). These independent banks play a crucial role in providing financial services and contributing to the economic growth of their customers and communities.
| Characteristics | Values |
|---|---|
| Number of commercial banks in the US | 3,917 |
| Number of savings and loan associations in the US | 545 |
| Total assets of commercial banks and savings and loan associations in the US | $24.5 trillion |
| Example of an independent bank | Bank Independent in Alabama |
| Number of branches of Bank Independent | 30 |
| Example of an independent community bank association | Independent Community Bankers of America (ICBA) |
| Characteristics of independent banks | Locally owned and operated, deposits stay in the local area, tailored services to the local population |
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What You'll Learn
Benefits of independent banks
Independent banks, also known as community banks, are locally owned and operated. They offer a range of benefits to their customers, including:
Stability and Longevity
Independent banks have a long history of stability and trustworthiness, with some having served their communities for over 160 years. They have supported local areas through economic crashes, wars, and other challenges. This stability is due in part to their independence, as they are not vulnerable to the same mergers and acquisitions that larger banks often undergo.
Local Focus and Community Support
Community banks are deeply rooted in the areas they serve. They understand the local market, regulations, and specific needs of their customers. Deposits made in these banks are reinvested into the local economy through loans to small businesses, mortgages, and charitable donations. This keeps money within the community, fostering economic growth and supporting local businesses and families.
Personalized Service and Long-Term Relationships
Independent banks are known for building long-term relationships with their customers, often serving multiple generations. Their employees have extensive tenure, offering experience, expertise, and local knowledge. Decisions are made with the community in mind, and bankers work closely with their clients to provide personalized solutions. This relationship-based approach considers more than just credit scores when making financing decisions, demonstrating a commitment to supporting the community's needs.
Flexibility and Tailored Services
Free from the constraints of a standardized, national menu of banking products, independent banks can offer unique and flexible solutions. They are nimble in processing and approving applications, and they service their own loans. This flexibility allows them to cater to the diverse needs of their local customers and provide customized financial solutions.
Ethical and Transparent Practices
Independent banks are committed to ethical business practices and transparency. They are not influenced by anonymous shareholders and are focused on serving their clients and communities. This alignment of values fosters trust and ensures that the bank's decisions are made with the best interests of the community in mind.
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Independent banks vs credit unions
Banks and credit unions offer similar financial products and services, but there are some key differences between the two.
Ownership and membership
Banks tend to be for-profit institutions owned by shareholders, whereas credit unions are usually non-profit entities owned and controlled by their members. Banks do not require membership, while credit unions do.
Interest rates and fees
Credit unions typically offer higher interest rates on savings accounts and lower interest rates on loans compared to banks. Credit unions also tend to charge lower fees, as they return profits to their members.
Accessibility
Banks generally have more branches and ATMs than credit unions, providing greater accessibility and convenience. Credit unions, on the other hand, tend to focus on serving their local communities and may offer more personalized customer service.
Safety
Credit unions are generally viewed as safer than banks because they take fewer risks and adhere to conservative investment principles. Deposits at both banks and credit unions are typically insured, with the FDIC insuring most banks and the NCUA insuring most credit unions.
Product offerings
Banks may offer a wider range of financial products, including various types of accounts, loans, and investment options. Credit unions may have fewer options, but they often provide tailored services and products to their members.
In summary, the choice between a bank and a credit union depends on individual preferences and financial needs. Those seeking higher interest rates, lower fees, and a stronger connection to the community may prefer credit unions. On the other hand, those who prioritize accessibility, a wider range of products, and in-person services may find banks more suitable.
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Independent banks in Alabama
Yes, there are independent banks in the United States. The Independent Community Bankers of America (ICBA) is an organisation that promotes an environment where community banks can flourish.
One example of an independent bank in Alabama is Bank Independent, which has 30 locations and a Digital Sales Office across the state. Bank Independent offers personal and business banking services, including checking, savings, money markets, and CDs. The bank also has a mobile banking app that allows customers to access their accounts and manage their finances on the go. In addition to its financial services, Bank Independent is committed to giving back to the community. The bank encourages its team members to volunteer in their communities and supports various charitable organisations.
Another independent bank in Alabama is Peoples Bank of Alabama, which offers checking accounts for personal and business use. Peoples Bank of Alabama also provides additional services such as dark web and credit monitoring through its partnership with Discover®.
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Independent banks in Michigan
There are a number of independent banks in the United States, and one of them is Independent Bank, which is headquartered in Grand Rapids, Michigan. Independent Bank has 62 branches, all of which are in Michigan. The bank traces its roots back to the First National Bank of Ionia, founded in 1864. Over the years, Independent Bank has undergone several reorganizations and acquisitions, including joining the NASDAQ stock exchange in 1985 and acquiring branches from TCF Financial Corporation in 2007.
Another independent bank in Michigan is First Independence Bank, which provides mortgage services and competitive banking products. First Independence Bank specifically caters to communities that may not be well-served by larger institutions.
Bank Independent is also mentioned, but it is based in Alabama and therefore outside the scope of this request.
Independent banks often focus on providing personalized services and fostering strong relationships with their customers. They may offer various financial services, including personal and business banking solutions, loans, and insurance. Additionally, some independent banks have digital tools, such as mobile banking apps, to enhance the customer experience and provide convenient access to their services.
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Independent Community Bankers of America
The Independent Community Bankers of America (ICBA) is the leading trade group for small US banks. It represents the interests of approximately 5,000 small and mid-sized financial institutions, commonly referred to as "community banks". The ICBA was founded in 1930 and is headquartered in Washington, D.C., with chapters across the United States.
The ICBA's mission is to foster an environment where community banks can thrive. To achieve this, they host conventions, publish the monthly magazine "ICBA Independent Banker", and lobby the United States Congress on banking industry issues. For example, during financial reform attempts, the ICBA has lobbied for credit unions to not gain a competitive advantage and for smaller banks to have the flexibility to choose their regulators.
The ICBA also offers various programmes and services to support community banks and their customers. One such initiative is the ICBA ThinkTECH Accelerator program, which promotes early-stage solutions tailored to community banks and their customers. The ICBA provides access to a range of products, services, educational tools, and training through its website.
The ICBA has six subsidiaries: ICBA Bancard, ICBA Securities, ICBA Financial Services, ICBA Mortgage, ICBA Insurance Services, and ICBA Reinsurance. These subsidiaries offer a diverse range of financial services and solutions to support the operations of community banks and their customers.
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Frequently asked questions
Yes, there are independent banks in the US. Independent banks offer a range of personal and business banking solutions.
Independent banks are typically smaller, community-based banks that focus on providing personalised services to their customers. They often have fewer branches and may not offer the same range of services as larger, national banks.
Independent banks often provide more personalised customer service and may be more flexible in their offerings. They are often trusted allies and valued partners in the communities they serve.
You can search for independent banks in your area by looking for specific bank names, such as Independent Bank in Memphis, TN, or Bank Independent in Alabama. You can also look for organisations that support independent banks, such as the Independent Community Bankers of America (ICBA), which creates an environment for community banks to flourish.
