FWBP talks with Mark Drennan of Southside Bank
Fort Worth Business Press’ Editor Robert Francis talked recently with Mark Drennan, President-North Texas Region of Southside Bank, one of the largest locally-based financial institutions in North Texas. Drennan, a Fort Worth-area native, joined Southside in 2017 and was rapidly promoted to president. No surprise, as he has been in the Texas banking industry for 17 years and was a previous 40 Under 40 honoree.
What are you seeing in terms of commercial lending activity that is hot in the North Texas economy right now?
2019 was a strong year for loan growth across North Texas and for Southside Bank as a whole. Our North Texas region had solid loan growth this year, which was driven by both our Commercial Real Estate and Commercial Banking teams. On the real estate side, the multifamily and industrial space played a key role in new loans closed. We are also active in homebuilding and lot development lending, which remained strong. For the commercial team, manufacturing, small business and owner managed businesses, and healthcare related companies provided a lift for the team. With interest rates remaining low and low-cost capital available, 2020 looks to be a solid year as well. We will see how COVID-19 (coronavirus), the upcoming election, and other external factors outside the business community play a role in the performance of the local, state and national markets as we move further into 2020.
What do you see as the impact of the COVID-19 on the U.S., Texas and local economy?
At this point, the local economy has been mostly immune to major economic impacts from COVID-19. The bigger question is how it affects the U.S. as a whole as we move forward. Apple announced it was cutting sales expectations due to slower production lines for its phones. Many larger global firms based in the U.S. depend on China to manufacture technology, automobile parts, oil/gas parts, and pharmaceuticals. The global supply chain is dependent on China, and with many of the factories remaining closed or getting back to partial utilization, this will undoubtedly have ripple effects on even small businesses and nonprofits who buy or sell merchandise made in China.
Also, with DFW International Airport and commercial aviation being a major economic driver in North Texas, temporary suspensions of flights and increased health screening at dozens of airports could affect some air carriers’ schedules and passenger ticket sales, as well as cargo shipments.
My grandparents owned a trailer shop for 50 years in Fort Worth and my grandmother always said she hated election year because business always slowed down. I’ve heard others say the same thing. Is that true? If so, what areas are impacted (capital spending, investments, hiring)?
Markets and economies don’t like uncertainty. Elections are key to corporate decision making as they can affect government regulation, trade policy, monetary/fiscal policy, and taxation. Companies can delay or pause capital spending and hiring in election years. Some companies (and consumers) cut or slow expenditures due to uncertainty until they know and understand what the future holds. Capital spending, investments, and hiring are all closely considered during election years mainly based on the uncertain economic impact in an election year.
The start-up, entrepreneur economy is growing in Fort Worth and North Texas and some of these companies are showing promise of growth? How do banks work with these companies and how can banks help these companies grow?
It’s exciting to see so many new start-up companies make their home in North Texas and specifically Fort Worth. Our bank strives to help new firms achieve success in all areas of their business and can direct them to experts in other fields for assistance. We can also help them identify alternative financing or capital sources in the event conventional commercial lending is not an option.