Jim Roche, president of the Maine Bankers Association, said he expects more banks to seek economies of scale through combinations.
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Following a pair of high-profile mergers in Maine’s banking sector — Gorham Savings joining forces with Maine Community Bank and Camden National snapping up a New Hampshire peer — one expert is predicting more consolidation in 2025.
“Banks have been under siege in recent years by a federal regulatory tsunami,” says Jim Roche, president of the Maine Bankers Association, a statewide trade group based in Westbrook.
On top of that, he notes that banks face increasing competition from credit unions that enjoy unfair advantages, such as an exemption from federal taxes and regulations like the Community Reinvestment Act.
“Unless the playing field is leveled between banks, credit unions and the largely unregulated financial technology industry, he says, “we can, unfortunately, expect more banks to look for economies of scale through combinations.”
He is nevertheless bullish on the sector in Maine and nationwide. “Like most businesses, banks are hopeful about the year ahead,” he says. “Interest rates have declined somewhat, the economy seems to be performing well, and the new administration in Washington is expected to have a lighter regulatory touch than the near-weekly regulatory barrage that has been the norm over the past four years.”
Roche also expects continued innovation by Maine banks. “Maine banks have invested heavily, and will continue to do so, in technology that both protects customers from fraud while enabling them to bank from anywhere — their phone, laptop, a bank branch, an ATM — at any time,” he says. “This is particularly important in Maine with its somewhat bifurcated population of older consumers, some of whom may not be tech-savvy, and younger consumers who may never have stepped into a bank branch.”
How the wider economy will fare depends on the new administration’s trade and tariff policies, Roche says. “High tariffs against Canadian and Mexican products will likely mean higher prices for Mainers,” he warns. “Maine’s economy, like the rest of the United States, is closely intertwined with the economies of our neighbors to the north and south. An intense trade dispute will not be good for consumers.”
