Bank deposits in Spokane County grew by more than 2 percent over the past year, and Sterling Savings Bank and Washington Trust Bank remained the leaders in market share for the second straight year, says an annual report released last month by the Federal Deposit Insurance Corp.

The report, which measures banks' deposits by county and metropolitan statistical area as of June 30 of each year, showed that the 18 FDIC-insured institutions operating here had total local deposits of $7.3 billion altogether on that date this year, up 2.4 percent from $7.1 billion in deposits spread among 18 institutions a year earlier.

Of the 18 institutions that were operating here in June 2008, 14 increased deposits over the following 12-month period.

Randall L. Fewel, president and CEO of Inland Northwest Bank, says he was pleased to see deposits at institutions in the county grow by $171 million in the 12 months ended last June.

"I thought that was encouraging," Fewel says. "I didn't expect it to be up at all."

Increases in deposits have been more significant in past years, but it was good to see any increase at all this time around, he says. The recession contributed to the smaller gain, as did the slight decrease in the number of branches in the market, from 130 as of June 2008 to 128 a year later, he says.

Spokane-based Sterling, with $1. 9 billion in deposits, climbed to a listed 26.9 percent market share in the latest FDIC figures, up from 24.4 percent, and $1.7 billion in deposits, on June 30, 2008.

"Our deposit growth shows that customers across the Pacific Northwest are responding well to the efforts we launched more than 18 months ago," says Ezra Eckhardt, acting president and chief operating officer of Sterling.

Sterling worked to simplify products and services and to make them more competitive, and also expanded Saturday hours at branches and added more automated teller machines, he says.

Meanwhile, Washington Trust, also based in Spokane, had a 23.9 percent market share in the most recent report, with $1.7 billion in deposits. A year earlier it had a 22.7 percent market share and deposits of $1.6 billion.

Bank of America ranked third in the recent report, with $730 million in deposits and a market share of 10 percent. Washington Mutual Bank is not among the 18 banks listed on this year's report, but in its place is JP Morgan Chase & Co., which bought the assets of the failed Seattle-based thrift and now is ranked fourth in Spokane County deposits with 7.9 percent of market share.

In the fifth, sixth, and seventh positions in the latest report were U.S. Bank, at 7.3 percent market share; Banner Bank, at 6 percent; and Wells Fargo Bank, at 5.8 percent. U.S. Bank and Banner retained the same rankings as a year ago, but Wells Fargo moved up one spot, replacing AmericanWest Bank.

AmericanWest dropped two positions, from seventh to ninth, as local deposits fell from $446 million to $176 million, and its market share shrank to 2.4 percent from 6.2 percent. AmericanWest's ranking change was the most significant here of the banks in the report.

Kelly McPhee, a spokeswoman for AmericanWest, says the biggest reason for the Spokane-based bank's decline in local deposits and market share is its decision to move away from what are called brokered deposits. Brokered deposits refer to deposits placed at an FDIC-insured bank by a broker, such as an investment firm, on behalf of a customer of its own. Such brokered deposits are placed on the books at the headquarters of a financial institution, which is Spokane in the case of AmericanWest. The FDIC report reflected a decrease in such deposits here, McPhee says, adding that AmericanWest wants to focus on true local deposits.

Along with Wells Fargo, Inland Northwest Bank moved past AmericanWest, taking eighth in the rankings.

"I was certainly pleased we increased our market share," Fewel says. Inland Northwest Bank, which had nearly $283 million in local deposits, up from nearly $245 million, is trying to break 4 percent in market share, he says.

"We're always trying to increase market share and deposit amount," Fewel says.

INB has been able to increase deposits as it converts branches inside grocery stores to free-standing branches, and has benefitted from the name recognition it has generated by its sponsorship of the INB Performing Arts Center downtown. It also picked up some of Washington Mutual's former business, he says.

"We're all fighting over core (local) deposits," Fewel says.

RiverBank held 10th place in the recent report, followed by two others that didn't change position, Bank of Fairfield and State Bank Northwest. All three increased deposits and market share.

Little has changed at the bottom of the rankings.

Rounding out the institutions serving Spokane County, in order of deposit market share, were Wheatland Bank, Panhandle State Bank, Bank of Whitman, Mountain West Bank, Armed Forces Bank, and Coastal Community Bank. Mountain West overtook Armed Forces Bank, after it sprang from $3.1 million in deposits in 2008 to $9.6 million this year.