John Paczkowski

Recent Posts by John Paczkowski

Bank of America Closing Branches You Never Went to Anyway

bofaRemember the last time you set foot in a real brick-and-mortar bank? Me either. And we’re not the only ones. With more and more people managing their financial affairs via PC and mobile device, a bank’s retail presence no longer need be as ubiquitous as it once was.

The latest institution to realize this–Bank of America (BAC) which, according to The Wall Street Journal, plans to close up to 10 percent of its 6,100 branches across the country over the next three-to-five years. It’s not yet known when the closures will begin or exactly how many locations will be closed. BofA says only that “Our vision is the network will be managed downward over time.”

About time too. With fewer and fewer consumers banking at their local branches and remote deposit capture an easy matter via ATM, it seems foolhardy to maintain them.

“They are not economically viable,” Rochdale Securities analyst Dick Bove wrote in a recent note to clients. “The branches are likely to be closed for three reasons: a) branch economics are changing; b) the need for positioning has been reduced; and c) the fear of regulation suggests closing branches now makes sense.

“When America was building new houses in the millions,” Bove continues, “it was creating new neighborhoods. Banks competed with each other to get branches into the new communities in the choicest locations. Branches were often built in supposed choice locations just to keep the competitors out. This strategy has now been abandoned. Many of the new communities have been abandoned. These branches need to be abandoned.”


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