Bank of Bird-in-Hand will open its second branch at a soon-to-be-closed BB&T branch in Leacock Township in Lancaster County.
The start-up bank, which opened its first branch in late 2013, also in Leacock Township, will operate its second branch at 3540 Old Philadelphia Pike in the Intercourse area. The building currently is a branch of BB&T — and formerly a branch of National Penn Bank.
BB&T recently announced it will close the branch in mid-July when it converts all of National Penn’s branches into BB&T branches. BB&T recently closed on its deal to acquire National Penn.
Bank of Bird-in-Hand President and CEO Alan Dakey said the move is based on both the market disruption sparked by bank acquisitions in the county over the last 18 months and the recent reclassification of what constitutes a de novo bank, the regulatory term for a startup bank.
In an effort to encourage de novo banks, the Federal Deposit Insurance Corp. recently changed a rule that classified de novo banks as startups for seven years. The time was cut to three years. Bank of Bird-in-Hand will no longer be a de novo bank as of Nov. 27.
Dakey said the change in classification reduces “substantial” reporting and regulatory requirements and will cut costs for the bank.
“It does allow us to grow a bit faster than we’ve been able to,” Dakey said. “We didn’t have branching in our initial plans as a de novo. The regulatory change has helped us move this along.”
Dakey said the bank is targeting August as the opening date, after BB&T closes the branch around July 15. Bank of Bird-in-Hand wanted the office because the area fits with the bank’s core approach of agriculture lending and small-business lending.
“We were fully aware other banks were interested in that site,” he said. “If you look at our current footprint, there is a lot of focus on (agriculture) lending and small business. We just feel this is a market we’ll do very well in.”
Bank of Bird-in-Hand has about $127 million in assets.