Are Banks and Credit Unions Underestimating Their Competition and the Size of Their Markets?

Are banks and credit unions underestimating their competition and the size of their markets? This question is especially relevant now as financial institutions refresh their strategic plans and develop their 2027 annual growth goals.

Finance will develop deposit and loan balances to hit the institution's financial plan. Retail is given their number and allocates goals across markets, regions and branches. The result may reconcile mathematically—but it does not establish whether those goals are supported by market dynamics. One reason is that institutions often do not have a complete view. The FDIC provides bank branch balances, but those are distorted by corporate, institutional and main-office deposits that are not part of the locally addressable retail market. At the same time, the NCUA reports credit union deposits at the institution level—not by individual branch.

What a combined bank and credit union view reveals

Our combined bank and credit union analysis revealed several important differences:

• Washington, D.C. and Miami have almost identical estimated addressable deposit markets—approximately $240 billion each. Yet credit unions hold an estimated 29.8% of Washington-area balances compared with only 6.7% in Miami.
• New York is the nation's largest estimated addressable deposit market at approximately $865 billion, but credit unions represent only 7.5% of balances. Even that relatively small share represents nearly $65 billion in estimated credit union balances.
• Between 2022 and 2025, 148 of 386 U.S. MSAs added credit union branches while bank branch counts declined. This changing distribution landscape creates additional pressure for community banks to understand where their local presence remains differentiated and where market-supported growth still exists.

• Atlanta: credit union branches +20; bank branches −24
• Seattle: credit union branches +21; bank branches −89
• Detroit: credit union branches +22; bank branches −59
• Philadelphia: credit union branches +10; bank branches −117
• Pittsburgh: credit union branches +11; bank branches −47

Why goal setting feels like a black box

For branch leadership, the goal-setting process frequently feels like a black box because it largely is one. Managers receive a number without a transparent explanation of the market growth, competitive position, local opportunity or branch capacity supporting it. Goals are based on history, and high performers are penalized to make up shortfalls from low performers.

Strategic planning done well provides a roadmap to faster, more sustainable growth. But when that roadmap is built without the right market variables, an institution can move confidently in the wrong direction. When branch teams don't understand the destination, the route or why their goals are achievable, even the strongest distribution network can run out of fuel.

The objective is not simply to set a growth target. It is to give every market and branch a credible path to achieve it.