THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Monday, April 1, 1996 TAG: 9603300192
SECTION: BUSINESS WEEKLY PAGE: 08 EDITION: FINAL
SOURCE: BY TOM SHEAN, BUSINESS WEEKLY
LENGTH: Medium: 69 lines
Peninsula Trust Bank should have no trouble filling job openings when it opens a new branch in northern Gloucester County this summer.
``With the downsizing we've seen among banks in Virginia, there is a wealth of successful, very qualified people available,'' said William Farinholt, president of the Gloucester community bank.
Despite their sustained profitability, many banks in the region have been reluctant to add employees. Several, in fact, have continued to cut their payrolls.
After rising in 1993 and 1994 from the depressed levels of the early 1990s, the number of banking jobs in Hampton Roads fell during 1995, according to the Virginia Employment Commission.
Banks and thrifts in the region employed 9,399 during the quarter ended Sept. 30. That was down from 9,551 during the April-through-June quarter and off from 9,685 in mid-1994, according to the commission.
One reason for the falloff has been a string of bank mergers, including Crestar Bank's acquisition of the Newport News thrift TideMark Bank last year. In addition, several banks and thrifts have decided they can function with smaller work forces.
In an effort to bolster their efficiency, some have scaled back or eliminated less productive lines of business. Virginia Beach Federal Savings Bank cut the size of its work force by more than 27 percent last year to fewer than 200 employees. Part of the reduction involved the sale of five Beach Fed mortgage offices outside of Hampton Roads.
Virginia Beach Federal also embarked on a campaign to cut costs and shift resources to new branches, said Dennis R. Stewart, the thrift's chief financial officer.
``To a large degree, this reflects the tremendous competition among banks,'' said Lawrence B. Pulley, a banking professor and associate dean of the School of Business Administration at the College of Williams and Mary.
The banking industry's pursuit of efficiency and the efforts to hold down payroll costs will continue, Pulley predicted.
Peninsula Trust, whose assets grew by more than a third last year to $108 million, expanded its work force by almost 50 percent during 1995 to 77. But that sort of hiring is the exception.
In Virginia Beach, Resource Bank added lending officers, loan processors and others to its mortgage-banking operations last year. But Resource has continued to hold down employment elsewhere in the bank, said Lawrence N. Smith, president and CEO of the community bank.
Statewide, employment at banks and thrifts has increased modestly but remains below the 55,479 total in mid-1990, according to Virginia Employment Commission figures. During the three months through last September, financial institutions in Virginia employed 54,100. That was up from 53,957 in the previous quarter and from 53,389 in the second quarter of 1994.
Most of the new jobs materialized at community banks, while larger statewide institutions continued trimming their payrolls.
During 1995, NationsBank Corp.'s Richmond-based bank was consolidated into the company's North Carolina bank, which now takes in Maryland, Washington, Virginia and both Carolinas.
At Signet, the number of jobs fell by more than a third last year, largely because the Richmond-based bank spun off its credit-card operation into a stand-alone company, Capital One Financial Corp.
A decade ago, it was difficult for community banks to attract highly skilled bankers, said Betsy Duke, president and chief executive officer of Bank of Tidewater in Virginia Beach. ``There was no way to get them out of other banks,'' she said. ``Today, they're easy to find.'' by CNB