Industry Overview - Metro Denver

FINANCIAL SERVICES: Metro Denver and Northern Colorado Industry Cluster Profile

Industry Overview

The nine-county Metro Denver and Northern Colorado region1 is the major financial center between Los Angeles and Chicago. Downtown Denver's financial district along 17th Street is known as the "Wall Street of the West." The region is one of the few areas outside of the northeast with a substantial financial services industry in three subclusters: (1) banking and finance, (2) investments, and (3) insurance. The banking and finance subcluster is comprised of transaction-oriented companies including commercial banks and credit unions, lenders, credit agencies, and mortgage bankers. The investments subcluster includes companies involved in securities and commodities trade, real estate investment trusts (REITS), and portfolio management. The insurance subcluster consists of insurance carriers and brokerages.

Denver is home to a branch of the Federal Reserve Bank and is the location of one of only six U.S. Mints. The Denver Mint manufactures all denominations of circulating coins, coin dies, the Denver "D" portion of the annual uncirculated coin sets, and commemorative coins authorized by the U.S. Congress. The Denver Mint stores gold and silver bullion and produced nearly 5.8 billion coins in 2013. Circulating coin production at the Denver Mint reached nearly 6 billion in 2014, a record that has not been reached since the Great Recession.

A variety of trade associations and service firms support the region's diverse financial services industry base of nearly 13,400 companies and about 94,800 employees. The Colorado Bankers Association is a key industry partner () representing all Colorado banks and provides government relations, community relations, educational and training services, and bank insurance. The Colorado Association of Mortgage Professionals () is another nonprofit trade group representing Colorado's financing professionals specializing in origination of residential and commercial mortgages and offers professional development opportunities and member certification support. The Metro Denver Economic Development Corporation (Metro Denver EDC) formed the Colorado Investment Services Coalition in 2014, which is an advocacy group for Colorado's large employers in financial management and advisory services. The Coalition is working with universities to develop the talent pipeline for the financial services companies expanding in the region, and will provide a public policy voice on issues of common interest.

Banking and Finance Economic Profile

The banking and finance subcluster consists of 16, six-digit North American Industry Classification System (NAICS) codes including both depository and non-depository institutions such as commercial banks, credit card companies, and mortgage brokers.

The nine-county region ranked seventh out of the 50 largest metro areas in banking and finance employment concentration in 2014. With direct employment in banking and finance of 38,970 workers, the region ranked 11th in absolute employment. About 77 percent of Colorado's banking and finance industry employees work in the region.

1 The nine-county Metro Denver and Northern Colorado region consists of Adams, Arapahoe, Boulder, Broomfield, Denver, Douglas, Jefferson, Larimer, and Weld Counties.

Metro Denver Economic Development Corporation | January 29, 2015 | Page 1

FINANCIAL SERVICES: Metro Denver and Northern Colorado Industry Cluster Profile

Banking and Finance Employment and Company Profile, 2014

Nine-County Region United States

Direct employment, 2014 Number of direct companies, 2014 One-year direct employment growth, 2013-2014 Five-year direct employment growth, 2009-2014 Avg. annual direct employment growth, 2009-2014 Direct employment concentration

38,970 3,150 -3.1% -8.0% -1.6% 2.1%

2,593,770 218,330 -1.7% -1.1% -0.2% 1.8%

Sources: Dun & Bradstreet, Inc. Marketplace database, July-Sept. 2008-2010; Market Analysis Profile, 2011-2014; Development Research Partners.

Banking and Finance Employment

The nine-county region's banking and

finance employment (38,970 workers)

declined 3.1 percent in 2014, compared

with the previous year's level. Similarly,

5%

national employment levels declined 1.7

percent over-the-year. While the

banking and finance subcluster

0%

rebounded from 2011 through 2013

after four-consecutive years of

employment declines due to the

national finance-related recession,

-5%

consolidations in the mortgage industry,

the changing regulatory landscape, and

capital and liquidity management contributed to employment declines in 2014.

-10%

2009

Financial Services-Banking and Finance Number of Employees Growth Rate

2010

2011

2012

2013

2014

Avg Annual Growth

About 3,150 banking and finance

Nine-County Region

United States

companies operated in the nine-county

Source: Dun & Bradstreet, Inc., Marketplace database, July-Sept. 2008-2010; Market Analysis Profile, 2011-2014.

region in 2014. Approximately 69

percent of the region's banking and finance companies employed fewer than

10 people, while 0.6 percent employed 250 or more.

Metro Denver Economic Development Corporation | January 29, 2015 | Page 2

FINANCIAL SERVICES: Metro Denver and Northern Colorado Industry Cluster Profile

Banking & Finance Employment by County, 2014

Jefferson 12.6%

Boulder 7.9%

Denver 26.3%

Adams 5.6%

Larimer 5.4%

Broomfield 4.4%

Weld 3.2%

Arapahoe 32.5%

Douglas 2.1%

Sources: Market Analysis Profile, 2014; Development Research Partners.

Banking & Finance Employment by Industry Sector, 2014

Federal Reserve banking

Savings 0.9% institutions

4.9%

Commercial banking 38.4%

Credit unions 6.7%

Personal, business, & federal credit institutions

11.2%

Financial transactions processing &

clearinghouse activities 15.4%

Mortgage banking & loan

brokerage services 22.5%

Sources: Market Analysis Profile, 2014; Development Research Partners.

Major Banking and Finance Companies

? ADS Alliance Data Systems

? Bank of the West

? BBVA Compass Bank

? Bellco Credit Union

? Citywide Banks

? CoBank

? Colorado Business Bank

? KeyBank

? Markit On Demand

? National Bank Holdings Corp.

? Nelnet

? Public Service Credit Union

? Pulte Mortgage

? Specialized Loan Servicing LLC

Metro Denver Economic Development Corporation | January 29, 2015 | Page 3

FINANCIAL SERVICES: Metro Denver and Northern Colorado Industry Cluster Profile

Major Banking and Finance Companies Cont'd

? Colorado Housing and Finance Authority

? Colorado State Bank and Trust

? Elavon

? FirstBank Holding Company

? First Data Corporation

? Guaranty Bank and Trust

? JP Morgan Chase & Co.

? U.S. Bank

? Urban Lending Solutions urban-

? Vectra Bank Colorado

? VISA Debit Processing Services

? Wells Fargo Bank Colorado

? Western Union

Investments Economic Profile

The investments subcluster consists of 15, six-digit North American Industry Classification System (NAICS) codes including companies involved in securities, brokerage, real estate investment trusts, and holding companies.

The nine-county region ranked 12th out of the 50 largest metro areas in investments employment concentration in 2014. With direct employment of 24,370 investment workers, the region ranked 12th in absolute employment.

Investments Employment and Company Profile, 2014

Nine-County Region United States

Direct employment, 2014 Number of direct companies, 2014 One-year direct employment growth, 2013-2014 Five-year direct employment growth, 2009-2014 Avg. annual direct employment growth, 2009-2014 Direct employment concentration

24,370 6,770 4.2% 9.9% 1.9% 1.3%

1,344,890 308,880 1.3% 2.9% 0.6% 0.9%

Sources: Dun & Bradstreet, Inc. Marketplace database, July-Sept. 2008-2010; Market Analysis Profile, 2011-2014; Development Research Partners.

Metro Denver Economic Development Corporation | January 29, 2015 | Page 4

FINANCIAL SERVICES: Metro Denver and Northern Colorado Industry Cluster Profile

Investments Employment

The nine-county region's investments employment (24,370 workers) rose 4.2 percent in 2014, compared with the previous year's level, adding nearly 980 new jobs over the same period. National employment levels rose 1.3 percent between 2013 and 2014. About 1.8 percent of the nation's investments employment is located in the region. Between 2009 and 2014, the region's investments employment rose 9.9 percent, compared with 2.9 percent at the national level. Investment companies employed 1.3 percent of the region's total employment base, compared with a 0.9 percent national employment concentration.

About 6,770 investment companies operated in the nine-county region in 2014. Approximately 94 percent of the region's investment companies employed fewer than 10 people, while 0.1 percent employed 250 or more.

Financial Services-Investments Number of Employees Growth Rate

5%

0%

-5%

-10%

2009

2010

2011

2012

2013

Nine-County Region

United States

2014

Avg Annual Growth

Source: Dun & Bradstreet, Inc., Marketplace database, July-Sept. 2008-2010; Market Analysis Profile, 2011-2014.

Investments Employment by County, 2014

Jefferson 9.9%

Douglas 10.7%

Arapahoe 25.3%

Boulder 7.1%

Larimer 4.8%

Adams 3.4%

Weld 3.0%

Denver 34.5%

Broomfield 1.4%

Sources: Market Analysis Profile, 2014; Development Research Partners.

Investments Employment by Industry Sector, 2014

Oil royalty traders

Security & 0.1% commodity

services 2.4%

All other trusts 5.1%

Real estate investment trusts

5.9%

Investors & investment advisory services

36.3%

Holding companies

15.9%

Security brokers & dealers 34.3%

Sources: Market Analysis Profile, 2014; Development Research Partners.

Metro Denver Economic Development Corporation | January 29, 2015 | Page 5

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