The landscape has changed dramatically in recent years.

Hugh Dailey reached into his desk drawer and pulled out a list of 59 banks that, since 1998, have had offices in Marion County at one time or another. Today there are 20, the result of mergers, buyouts and bank failures that, combined, have significantly altered the local banking scene.

Dailey is president and CEO of Community Bank & Trust of Florida, which is now the only Marion County-based bank. It has 11 offices in Marion, Alachua and Sumter counties, and has managed to buck the national decline of community-owned and locally based banks. (This story only addresses banks, not credit unions or other types of financial institutions.)

If the bank trend continues, Dailey said, the ultimate loser will be the customer.

“You’ll have five to six large banks to choose from," he said, "and that’s not healthy.”

When big banks rule, Dailey said, there’s less focus on the community's particular needs. Branches of large national banks often don’t have the authority to make loans, must defer to corporate loan policies, or take a loan request and send it to their regional offices, like waiters taking food orders.

Dailey need not look far to see evidence of all the acquisitions and mergers. From his second-floor office on Southwest 19th Avenue, Dailey can peer across the street and see the succession of what began as SouthTrust Bank.

In 2004 SouthTrust announced its merger with Wachovia. Four years later Wells Fargo bought out Wachovia. For the time being, it remains a Wells Fargo bank

Then there is what used to be Alarion Bank, whose main office was in downtown Ocala. Formed in 2005 with $15 million in capital and only one office in Ocala, it grew to three offices in Ocala and three in Alachua County. Less than a decade later, the hometown bank was sold to HeritageBank of the South.

HeritageBank of the South closed the downtown office. The Georgia-based bank was itself bought by Renasant Bank of Tupelo, Mississippi, in 2015.

That same year, the parent company of Ameris Bank announced the acquisition of Gainesville-based M&S Bank, and South Carolina-based CBC National Bank acquired Ocala-based First Avenue National Bank, which has been in business since 2006.

Just last year CenterState Banks Inc. in Winter Haven acquired locally based Gateway Bank of Central Florida.

CenterState previously had taken over Independent National Bank in Ocala, Ocala National Bank and Central Florida State Bank, which had been closed by federal regulators.

CenterState also announced this summer that it is buying Fort Pierce-based Harbor Community Bank, which recently bought Gainesville-based Florida Citizens Bank.

There were as many as 14,000 community banks nationally in 1992. By 2016, it was down to about 5,400, according to The Economist.

Community Bank & Trust of Florida has about 200 shareholders. They almost all live in Marion, Alachua or Sumter counties, which are the three counties the bank serves. Its board is also made up of members who live in one of the three counties.

Dailey said that the way Community Bank & Trust of Florida was formed in 1997 shows that the intent was to serve the local community and ensure its leadership remains here. Investors bought shares for $10 each, and any one investor, or group of investors, was limited to no more than 7 percent of the bank. The organizers raised $7 million that way.

“The interesting thing is, we raised it in 30 days,” Dailey said.

There has been little employee turnover, and customers know the people who work at the bank, Dailey said. The bank has 135 employees.

Why all the mergers and buyouts? Dailey said much of it is due to the cost of bank regulations. Larger banks can more easily absorb regulatory costs because they have the staff and resources that community banks don’t.

Meanwhile, many of those regulations are failing to protect customers, he said. Consider how Wells Fargo was opening unwanted bank accounts and credit cards for customers so staff could collect the extra fees and charges. Bank of America sold bad subprime mortgages and settled with the federal government for billions of dollars in fines.

Those violations and others like them aren’t detected by federal inspectors for years, and by then the damage is done, he said.

Dailey said those national banks have gotten too large — and it shows. “They’re too big to manage and too big to regulate,” Dailey said.

Meanwhile, small community banks have to suffer for the misdeeds of larger banks, he said.

In Marion, Sumter and Alachua counties combined, Community Bank & Trust of Florida has about 5 percent of the market share. In that market it also holds $645 million in deposits. By comparison, Bank of America has 16.5 percent of the market share with more than $2 billion in deposits. Wells Fargo controls another 16.25 percent of the market and holds another $2 billion in deposits.

Dailey said the community benefits from his bank because the money generated from loans and investments returns to the three counties where its shareholders live and work, unlike conglomerate banks, which send revenues to corporate headquarters.

In many cases, community banks are the only banks available to rural counties, said Camden Fine, president and CEO of independent Community Bankers Association in Washington D.C. Of America's 3,250 counties, 600 have only community banks, he said.

Bank of America has closed about 1,600 branches since the financial crisis, part of the bank’s focus on more profitable metropolitan areas. The bank had received about $45 billion in help during the crisis.

Fine agrees with Dailey that regulations on small banks are too onerous and create an unfair burden. From 1970-1990, banks followed “78 discreet regulations,” Fine said. “After 2008-2011, it went on steroids. Today there are over 325 discreet regulations.”

“These big banks can handle that. Small banks can’t…,” he said. “There are literally tens of thousands of pages of regulations.”

Another problem: low interest rates. “Community banks depend on the spread of what you can buy money and what you can lend it out at,” he said.

To regulate small, local banks with limited deposits and customer numbers the same as national banks “is insane,” Fine said.

And people need to understand that community banks affect far more people’s lives than they think. “Community banks hold about 18 percent of U.S. deposits but make over 60 percent of small business loans,” Fine said.

Smaller, community banks are more likely to stick with their customers in tough times, he said, adding, “They have to live and die in the communities with their customers.”

Fine said that local branch managers for national chain banks don’t always have the authority to make those kinds of tough decisions. “They have to keep everything a little vanilla,” he said.

Mark Casse of Marion County is one of the most successful horse trainers in the world. One of the banks he works with is Community Bank & Trust of Florida. He has banked with the institution since it opened.

“I’ve been very fortunate in my life to have had great things happen. I can honestly say that if not for the community bank many of those things wouldn’t have happened,” he said.

Larger national banks often don’t understand the community or the industry you’re in, Casse said. While Casse’s successful racing and training reputation opens financial doors, that wouldn’t be the case for a young person new to the business.

He recalls about 30 years ago when he went to a national bank for a loan. “They just sort of laughed at me,” Casse said.

Community Bank & Trust of Florida also makes loans to horseman to buy horses, using the animals as collateral.

Of course, big banks — and medium-size ones that have a presence here but are based outside of Marion —take issue with the notion that smaller, community-based banks are the only ones that can adequately meet a community's needs.

Representatives from these other banks are active in local civic affairs and are parts of, and connected to, the communities they serve. They also note that bigger sometimes can, in fact, be better.

"Recent research points to significant economies of scale and scope at large financial institutions, leading to efficiencies for businesses and consumers," according to a report from the national Bipartisan Policy Center. "Consumers and businesses have responded, with some evidence suggesting they are voting with their feet and choosing to form relationships with large institutions. Large, globally active banks facilitate international trade, spread socially beneficial innovations, and promote economic growth."

Indeed, though Bank of American has closed branches lately, another big bank, Chase, the U.S. consumer and commercial banking business of JPMorgan Chase & Co., is currently building four new branches in Ocala and a few in Gainesville.

Its market director, Damian Degregorio, said “growing organically” has been a winning strategy for the bank, especially in Jacksonville. Though Chase is big, leaders try to achieve “that small bank kind of feel,” Degregorio told the Star-Banner.

Tom Ingram, who heads what used to be Gateway Bank in Ocala, said that customer service and a commitment to community are qualities not limited to locally owned banks.

CenterState this year bought Gateway Financial Holdings, which was a holding company of Gateway Bank of Central Florida with offices in Ocala, Gainesville and Alachua. Gateway Bank of Florida had offices in Daytona Beach, Ormond Beach and Port Orange, and Gateway Bank of Southwest Florida had offices in Sarasota and one in Bradenton.

“I have more (lending) authority with CenterState than I had with Gateway,” Ingram said, reminding a reporter that CenterState’s “roots are in local community banks.”

Customers should examine the level of service they’re receiving from their bank rather than focus so much on whether it’s locally based, he said. What used to be Gateway in Ocala still has most of its same employees, but now also has more branches, more locations, and more financial resources to serve customers.

So why do bank shareholders agree to merge or sell? Ingram cites a few common reasons.

Banking regulation is expensive, and either merging or selling allows for economy of scale advantages, he said. Merging allows banks to share resources such as marketing staff, human resource departments and offices.

Another reason is the shareholders themselves, Ingram said. They expect a return on their investment, and when banks have limited capital or other means for expansion or increasing revenues, selling or merging is often the best financial choice.

While it’s true that many banks that merge or get sold off lose some of their connection to the community, Ingram said, it doesn’t have to be that way. CenterState’s business model was rooted in the same core values as Gateway, he said: faith, family, longevity and local decision making.

“The president (of the local offices) is the one who runs the show,” Ingram said, referencing CenterState banks.

Still, people like Pastor BJ Osoba, fromSoutheast Gainesville, have found the most success with local players.

His storefront church of 50 parishioners and their children saved money and last year bought an AME church on Archer Road. It needed well in excess of $100,000 to renovate the church and outside property.

Osoba and his wife, Teresa, with whom he started the church, went to two large banks for a loan. Both turned the couple down. The third, Community Bank & Trust of Florida, did not.

The church got the loan it wanted last year and remodeling finished this year.

“They agreed to give us a chance,” Osoba said. “We cried when we got the loan.”

He said the church hasn’t been late on a payment since.

The church had saved its money and showed it could be fiscally responsible, Osoba said. The problem was other banks didn’t recognize that.

“If this bank allowed me to I’d work for them for free just to tell people about the bank,” he said. “At least they give you a chance. They don’t throw you off because you’re small.

“I don’t consider them as my bank,” he said, “I consider them my banker (which looks out after the church’s best interest).”

Reach Fred Hiers at fred.hiers@starbanner.com and 352-397-5914.