What does the new Trump administration in the White House mean to the banking industry and region’s economy?

It’s too early to tell.

But two banking industry experts have simple advice for local business owners: keep your eye on what you do best.

“There’s lot of noise in the media. … Focus on your business and what made you successful,” said Steve Scranton, a senior vice president, chief investment officer and economist who has been with Washington Trust Bank since 1987. He’s based in Spokane.

Scranton said his biggest concern is how national policies on trade and immigration will affect the Northwest economy.

“Those are two areas that can truly have a negative impact for this state,” he said.

Roddy Baze, vice president of Washington Trust Bank’s Kennewick branch, where he’s been since it opened in 2000, agreed: “In the Columbia Basin, we export a large amount of our crops around the world. We rely heavily on labor flow from Mexico. I think that’s the major concern for our customers. The expectation is labor going to be tight and cost more.”

Scranton said Washington “clearly has benefited from immigrants coming to this state.”

He cited a New American Economy report that said 4 percent of the state’s population are undocumented immigrants.

A majority of the state’s immigrants hold respectable jobs and this isn’t usually part of the conversation when discussing immigration issues, he said.

The study showed:

• 63 percent of agricultural workers are immigrants.
• 45 percent of software developers are immigrants.
• 42 percent of hand packers and packagers are immigrants.
• 31 percent of computer programmers are immigrants.
• 42 percent of maids and housekeepers are immigrants.

Immigrants in the state also paid $590 million in federal, state and local taxes, according to the report.

Despite the uncertainties ahead, business owners should take solace in the strength of the local and regional economy.

The Tri-Cities experienced a stronger overall job growth rate than the U.S., with 1.9 percent year over year job growth compared to the U.S.’s 1.5 percent growth rate, Scranton said, citing Bureau of Labor statistics.

He said the Tri-Cities’ best industry growth came in the financial services sector with 5 percent growth followed by education and health services with 3.3 percent growth. That compares to the professional and business services national sectors with 2.6 percent growth and education and health services’ 2.6 percent growth.

The Tri-Cities’ slowest industry growth was professional and business services at 1.4 percent. Nationwide, it was mining and logging at minus 10.5 percent.

Scranton also noted the Tri-Cities’ favorable gross domestic product growth of 5.2 percent compared to the nation’s 2.6 percent rate. And nearly 20 percent of the state’s Washington GDP is export related, he said.

“My view would be the Tri-Cities and the Northwest as a whole have seen good economic growth,” Scranton said.

Baze pointed to the Tri-Cities’ stable local economy in construction, with both residential and commercial, seeming to do well.

“Most of our commercial customers have had a very good 2016,” Baze said, adding that he doesn’t see anything on the horizon to prevent 2017 from following the trend.

“We’re in an extremely fortunate position as we move forward,” he said, also noting that the Tri-Cities has “been on a pretty good run when the recovery started in 2011 and 2010.”

Scranton also said he expects interest rates to gradually rise this year.

“We believe the Federal Reserve is cautious about raising rates too much,” he said

And how should investors position their fixed-income portfolios? “Investors should be diversified,” he said.

Scranton’s advice for those considering buying a home this year is to buy one if they find one they like that’s affordable because mortgage rates are still close to historic lows.

“From a historical perspective, it’s still a great time to buy a house,” Baze said. 

As the banking world transitions into a more tech-driven world, Washington Trust Bank plans to continue to spend time on fostering personal relationships — while offering the latest technology, Scranton and Baze said.

“We’ve always tried to be innovative. We’re always going to be fast followers. As technology evolves, we’ll be adapting that. Our primary focus has been and continues to be client service,” Scranton said, saying the personal touch and availability will continue to be the bank’s focus.

Baze said his primary customers in the commercial and ag arenas like “face-to-face contact when they talk about issues going on with their business,” he said.

The bank must continue to offer mobile banking options, but “we still see a customer base that definitely wants the technology but wants to talk to a real person. That’s who we’ve always focused on,” Scranton said.

Both men have been in the industry for decades and when asked what trends they’ve noticed over the years, their answers differ.

Baze said it’s the consolidation of farms over time: “There are more corporate farms.”

The other change is the adapting to the competitiveness in the world. “As we get more competitive in the world, there’s continued pressure to be a low-cost provider with good quality,” he said.

Scranton said he’s concerned about the closing of the small community banks and a trend toward consolidation, not necessarily because of financial problems.

“With the regulatory burden, it’s made it impossible to be in business. I just worry that small businesses (who) rely on smaller banks” in a small community won’t be able to secure loans from larger, multinational banks, he said.