Bank branches clos­ing as clients turn to tech

Nearly two-thirds of PNC cus­tomers didn’t visit an of­fice in 2018.

Dayton Daily News - - FRONT PAGE - By Max Filby Staff Writer

The num­ber of bank branches in the Day­ton metropoli­tan area has de­clined by nearly 18 per­cent in the last 10 years, a change ex­perts say was largely driven by new tech­nol­ogy and new cus­tomer pref­er­ences.

The num­ber of bank branches in the Day­ton re­gion has de­clined by 44 from 246 to 202 since the year 2008, ac­cord­ing to an­nual mar­ket share re­ports from the Fed­eral De­posit In­sur­ance Cor­po­ra­tion.

De­spite the de­cline in lo­ca­tions, area branches have ac­tu­ally seen de­posits in­crease by more than $2 mil­lion in the last decade, FDIC re­ports show. It’s a re­flec­tion of how bank­ing is chang­ing and ad­just­ing to cus­tomer de­mands, said JT Thurston, spokesman for the Ohio Bankers League.

“Banks have al­ways been all about the cus­tomer,” Thurston said. “That’s the busi­ness model, be­cause if they were not meet­ing the needs the cus­tomer, then the cus­tomer would seek ser­vices else­where . ... They have no choice to re­main on the cut­ting edge.”

With 37 branches in the area, Fifth Third Bank pro­vides ser­vices to nearly 30 per­cent of the peo­ple Day­ton re­gion, ac­cord­ing to the FDIC. The Cincin­nati-based bank is al­ways look­ing at ways to im­prove its ser­vices at branches

and on­line, said Doug Smith, se­nior vice pres­i­dent and di­rec­tor of con­sumer digi- tal bank­ing at Fifth Third.

More than half of Fifth Third’s cust o mers have started us­ing mo­bile and on­line bank­ing. Pe­nal­iza­tion has be­come key to bank- ing and dig­i­tal tools “cre- ate an­other chan­nel” for peo­ple to do their bank­ing, Smith said.

“The whole con­cept of one size fits all is gone,” he said.

Techn o logy has been a big con­trib­u­tor to the de­crease in the num­ber of bank branches over the last decade, said Nick Oster­feld, PNC Bank se­nior vice pres­i­dent and re­gional man­ager of Day­ton’s south re­gion.

With 23 branches in the Day­ton area, PNC Bank has the third most lo­ca­tions in the re­gion, the FDIC re­ports. But ap­prox­i­mately 66 per­cent of PNC cus­tomers did not step into a bank last year, in­stead they used dig- ital bank­ing tools from the com­pany, Oster­feld said.

“That is some­thing that is driv­ing our in­dus­try,” Oster- feld said. “Cus­tomers are de­mand­ing it ... you have to pro­vide that to your cus­tom- ers or you won’t have them.”

Though the num­ber of branches could con­tinue to de­cline based on geog- ra­phy, Thurston said they won’t dis­ap­pear al­to­gether, they’ll just ad­just.

Some banks have even tried to be­come less like banks and more like des- tina­tions.

Rich­mond Bank, which has lo­ca­tions through­out cen­tral Ohio, is try­ing to at­tract cus­tomers with a more cafe-like at­mos­phere, Thurston said. The bank opened full-ser­vice cof­fee shops in three of its branches in 2015 where peo­ple can make do­na­tions for a cup of their fa­vorite brew, ac­cord­ing to Rich­mond Bank’s web­site.

“All of this is cus­tomer driven,” Thurston said. “If there is a mar­ket need for a brick and mor­tar pres­ence the banks are go­ing to pro­vide it. If it con­tin­ues to shift in an­other di­rec­tion then that’s the di­rec­tion the banks will go.”

CON­TRIB­UTED

With 37 branches in the area, Fifth Third Bank serves nearly 30 per­cent of the peo­ple in the Day­ton re­gion, ac­cord­ing to the Fed­eral De­posit In­sur­ance Cor­po­ra­tion.

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