Blog Post

Insight: The Role of Industrial Banks in the Utah Economy – But First, What Is an Industrial Bank?

By: Andrea Thomas Brandley

Note: The opinions expressed are those of the author alone and do not reflect an institutional position of the Gardner Institute. We hope the opinions shared contribute to the marketplace of ideas and help people as they formulate their own INFORMED DECISIONS™.

In 2019, Utah’s 14 industrial banks held $140.6 billion in assets, such as loans, 93.5% of the total for all industrial banks in the United States. That large majority caught my eye as I’ve lived in Utah my whole life, and up until last month I had no idea what an industrial bank even was! Industrial banks (also known as industrial loan companies) are state-chartered institutions that provide financial services to individuals and organizations. However, they differ from the average bank in a few important ways:

  1. They are usually branchless – You can’t walk in and set up a checking account like you would at your local bank. All Utah industrial banks are branchless although a few out-of-state industrial banks have branch locations.
  2. They can be owned by nonfinancial companies – Commercial businesses can own indust