In the year ended June 30, 1996, deposits in financial institutions in Spokane County grew at the lowest rate in a decade, new figures show.


Deposits in the county totaled $4.091 billion as of June 30, up just 1.3 percent from $4.039 billion at the end of the year-earlier period. That modest growth rate was the lowest annual gain since 1986, when deposits fell 1.5 percent here in the comparable 12-month period. In the decade in between, deposits grew between 2 percent and 5 percent annually. In the 12 months ended June 30, 1995, deposits grew 3.8 percent.


The figures were compiled by Sheshunoff Information Services, of Austin, Texas, for the Federal Home Loan Bank of Seattle. The latest figures cover all deposits in financial institutions in Spokane County as of June 30, 1996, and are the most recent figures available.


Peter Stanton, president and CEO at Washington Trust Bank, of Spokane, says the decline in deposit growth here is due to a couple of factors: A slowdown in the number of people moving to the Spokane area and a nationwide trend of people putting their money in the stock market in search of higher earnings, rather than in conservative certificates of deposits and savings accounts.


Certainly, it doesnt surprise me, Stanton says, especially considering that nationally, deposit growth was flat. Peoples risk-to-return philosophy has changed, he says, adding that, There has been no (stock) market correction that has led to a flight to safety.


Steven Dahlstrom, president and CEO at Spokane Teachers Credit Union, of Spokane, says the trend toward investing in mutual funds could lead financial institutions to do business differently.


Now, an institution may make a loan based on the deposits it has, he says. In a year or two, that same institution could, for example, make a loan using money it borrows from the Federal Home Loan Bank, which got the money from investments made by the mutual funds that financial institutions customers have invested in, Dahlstrom says.Credit unions outpace market hereMeanwhile, in the race for deposits in Spokane County, credit unions handily outpaced the overall market, while commercial banks lagged.


Deposits at credit unions rose a strong 10.6 percent to $934.6 million. Credit unions here captured 22.8 percent of the market, up from the 20.9 percent market share they held on June 30, 1995. With the exception of the 1995 period, credit unions have increased their market share in each comparable 12-month period for at least the last 15 years.


Dahlstrom says people continue to turn to credit unions because they like the local ownership of the institutions and the services they provide.


We offer an alternative that people are looking for, he says. There is a difference in philosophy. We dont have to make a big profit.


At commercial banks, deposits edged up 0.4 percent to $2.45 billion. The banks market share remained a strong 59.9 percent, though down slightly from 60.4 percent 12 months earlier.


Deposit numbers in the two other categories of financial institutionsmutual savings banks and savings and loanscant be compared with earlier figures because of a change at Washington Mutual Bank, of Seattle.


In previous years, Washington Mutuals deposits were split between two categories since the bank was operating under two charters, says Terry Onustack, a bank spokesman in Seattle. Some of Washington Mutuals operations here were under a mutual savings bank charter, while others fell under a savings and loan charter, he says.


In December 1995, the bank consolidated its operations in Washington under a single charter, which means that all of its deposits here now are reported under the mutual savings bank category.


Combined, deposits in the two categories were down 6.2 percent in the year ended June 30, to $706.5 million. Together, their market share for deposits fell to 17.3 percent from 18.7 percent.