Despite a challenging year for both residential and commercial real estate, New Hampshire’s fastest-growing lenders are overcoming the odds – and sometimes even their own past blunders.

In residential real estate, inventory and sales were, yet again, way down in the first half of the year, a trend that started well before this spring and continued right through this past summer.

Still, M&T Bank chalked up the biggest percentage growth in residential lending volume in the first six months of the year, originating $15.9 million in loans in New Hampshire, for a 236 percent increase over the same period in 2023, according to data from The Warren Group, publisher of The Registry Review.

Kennebunk Savings Bank, the Maine-based institution with a strong presence in New Hampshire’s Seacoast market, came in second with $11.4 million in loan volume in the state, up 224 percent, from $3.5 million during the first half of 2023.

The other top five fastest-growing leaders, based on their percentage increases in residential lending in New Hampshire in the first half of 2024 compared to the first half of 2023: Finance America LLC ($8.9 million, up 184 percent), Longbridge Financial ($14.9 million, up 179 percent) and Keystone Funding ($19.3 million, up 160 percent), according to The Warren Group data.

On the commercial real estate side, lenders also faced headwinds, including an overall tough CRE debt market amid high interest rates and a post-pandemic economy that’s left many businesses more than a little wary of expanding.

BankProv, the Amesbury, Massachusetts-based commercial bank owned by Provident Bancorp, led the fastest growers in Granite State commercial real estate lending in the first half of the year, with $70.1 million in CRE loans originated in New Hampshire, up a whopping 5,231 percent, according to The Warren Group’s data.

Another Massachusetts bank from just over the border ranked second: Newburyport Bank generated $41.3 million in CRE loans in the first half of the year in New Hampshire, up 1,200 percent.

The other top five fastest-growing CRE lenders statewide were: Ledyard National Bank (with $18 million in loans, up 416 percent), Bank of New Hampshire ($49.38 million, up 260 percent) and Mascoma Bank ($30.6 million, up 205 percent).

Who are New Hampshire’s fastest-growing lenders? See our rankings to find out!

A Big Comeback

BankProv’s position as the fastest-growing commercial real estate lender in New Hampshire was somewhat of a surprise, considering that only two years ago the bank was reeling from a $35 million loss in one of its cryptocurrency mining portfolios and the subsequent departure of its CEO.

BankProv’s new chief executive, Joe Reilly, has openly called the bank’s past foray into cryptocurrency lending an “unfortunate” mistake.

In an interview with The Registry Review, Reilly, a veteran New England banker and a former president of the New Hampshire Bankers Association, said BankProv’s surge in CRE loans was the direct result of the bank’s decision to change its focus from primarily commercial and industrial (C&I) lending to commercial real estate lending.

“We just made a strategic shift,” Reilly said. “Commercial mortgages were [previously] not as big a focus for us, but we changed that in 2024.”

And, almost needless to say, the bank has also entirely rid itself of its disastrous cryptocurrency loan holdings.

BankProv, with $1.6 billion in assets, may be headquartered in Massachusetts, but 60 percent of its business is generated via New Hampshire, Reilly noted. The bank has in-state branches in Bedford, Exeter, Portsmouth and Seabrook.

Persistence Pays Off

Ledyard National Bank CEO Josephine Moran attributed her Hanover-based bank’s CRE loan growth, as well as its impressive residential loan growth of 76 percent in the first half of the year, to establishing new strategic goals – and then sticking with them despite market challenges.

“When I came here, my charge was to grow the bank – and that’s what we did,” said Moran, who joined Ledyard National Bank as president in 2022 and became CEO in 2023.

She was previously chief retail officer at Provident Bank in New Jersey.

She said the growth game plan for both commercial and resident lending entailed hiring new loan officers, investing in a new marketing strategy, increasing the training of personnel and changing incentive programs for employees.

“We were lending when other banks weren’t lending,” she said. “It was challenging. [It took] a lot of blood, sweat and tears.”

Besides its strong showing in CRE lending in the first half of 2024, Ledyard also fared well in its residential loan business as well, with residential loans up 76 percent in the first half of the year, to $18.4 million, according to The Warren Group’s data.

Ledyard ranked 12th in overall residential lending growth in New Hampshire in the first half of 2024.

A Tough Year for Mortgage Lending

For all residential lenders, it was once again tough in terms of inventory and the number of sales.

The first-half inventory malaise continued right through August, with single-family homes sales falling to 5,836, down by 6.8 percent, compared to last year’s year-to-date numbers through August, according to The Warren Group.

But with strong demand and low supply dominating the market, prices have continued their relentless drive upward, with the median price for a single-family home rising to $515,000 year-to-date through August, up 14.4 percent compared to the same period last year.

The big price increases partly explain the rising loan volume for many lenders.

Matt Le, head of residential lending at Kennebunk Savings, said he was “pleasantly surprised” by his bank’s first-half surge in residential lending in New Hampshire, largely in Rockingham and Strafford counties.

He attributed the rise partly to people slowly accepting that today’s higher interest rates are here to stay, even if the Fed does lower them a bit.

“If they can afford to do so, they’re going for it,” he said of buyers proceeding with purchases. “People are getting used to where the rates are today.”

But Le expressed concern about how much more buyers can take when it comes to ever-rising home prices.

“People can only dedicate so much of their incomes to housing,” he said. “The payments they have to make for housing can be shocking.”