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Has anyone noticed that almost anytime a retail storefront property becomes available it is snapped up by another bank for a new branch? There are more bank branches than ever before. And I believe this phenomenon is occurring in many towns and neighborhoods.
A. I have not noticed.
B. Why do you, opening poster, think there are too many bank branches?
C. In the browner minority neighborhoods, their political leaders complain of not enough bank branches, too many low-quality high-priced financial service shops (e.g., check-cashing services), and too many liquor stores.
Businesses locate where there are customers.
Banks will do what is profitable. If they think branches bring profits, that is what they do. Banks that do not make profits go out of business.
@UJM
I have no idea what locale you are in, but th3e opposite is the national trend.
My town in Southern Connecticut has lost 7 retail bank branches in the last 5 years (in a growing healthy town,
Chase Bank has cut hours and days in Fairfield County branches still open. HSBC withdrew from the market and CitiBank closed 90% of CT branches.
I am on both the Town and regional Economic Development Commission. The internet, mobile apps and now the Pandemic has destroyed most in person retail banking.I don’t know when I last used cash for anything. If I receive a chedk, I taker a picture with my iPhone and deposit it that way.
Mrs. CTL and I just bought a property and handled the mortgage 100% by email and used esign to close. No trip to the bank needed.There is an application at our P&Z Commission tomorrow evening to turn a closed bank branch (closed 5 years ago and no other bank wanted it) into a pharmacy with a drive thru lane. Our town doesn’t usually allow drive thru window at businesses, but this will pass. We have too many empty bank buildings.
Last month People’s United Bank announced they would not renew leases for their branches in CT Stop and Shop supermarkets, Lack of interest caused by change of shopping habitsSorry for all the typos. my hands are not working well today
I feel we have too many bank branches in the 5T. We have Capital One, Apple Bank, Chase, Citibank, Roslyn Savings Bank and one or two others within a 3-4 block radius. We did have an HSBC too but that one closed.
Why does anyone care if there are a lot of bank branches around?
If we didn’t have too many bank branches, we wouldn’t have new Starbucks locations.
ujm: If you have a “more useful business”, then you should be able to go to the landlord of the property and offer him more money than the bank, since by definition your business will generate more profits.
If you feel than bank branches reflect an unwise business decision, you can purchase a “short” of the bank’s stock, since business that make unwise business decision will end up with lower profits and a lower stock price.
I suspect the banks feel that frum neighborhoods are good places to do business since they have vibrant small businesses and a young population (and small businesses and new families require the sorts of transactions one can’t do at an ATM machine, such as making loans), and where people are less comfortable transacting all business in an online environment. I note that none of the banks you mentioned as having branches have been in the news for being in danger of being closed down due to insolvency.
Unfortunately, I think we are headed back to ‘over-regulation” of bank location decisions with the new administration. Specifically, they are prone to using very mechanical rules governing “access to banking” metrics which operate on the theory that “unbanked” individuals are in that status because they lack close physical proximity to a traditional retail bank location. Bank is not a “field of dreams” business where if you build it, “they will come”. In reality, Banks are actually very good at decisions on their retail branches and if they can make money, they will be there quickly. Studies have shown that for most of the “unbanked”, giving them debit cards where balances can be easily tracked on a cheap phone is one of the most cost-effective solutions.
Branch bank location decisions are subject to state approval/regulation. The change of administration in Washington has nothing to do with it.
CTLawyer: For state regulated banks, which are the large percentage, that is entirely correct. Also some local zoning regs may effectively restrict locational decisions.
Banks with federal supervision may have other rules (e.g. see FDIC regs at 12 C.F.R. § 303.40 with respect to approvals for branch locations, relocations, seasonal openings etc). Also, in federal redlining and other discrimination lawsuits against banks/S&Ls subject to Federal supervision, the lack of sufficient locations in minority neighborhoods has been a frequent issue.@Gadolhadorah
Very few banks left subject to Federal Regulations.
Every single CT bank that had the word National in its name when I was growing up, changed name and to state regulations only.
I can only find one Federal Savings and Loan left in my county and it is based at a defense contractor.
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