Bank Branch Closures Hit Record: 247 In Michigan Shuttered
U.S. bank retail branch closings increased 38 percent in 2021, including several in Michigan, as pandemic drives digital banking.
Michigan saw a net loss of 247 banks last year, which was the second most only behind California’s 269. (Shutterstock)
Correction: This story has updated to reflect that net closures of U.S. banks increased 38 percent in 2021 when compared to 2020.
MICHIGAN — A trend toward digital banking during the COVID-19 pandemic drove banks to shrink their brick-and-mortar presence in Michigan last year. That’s according to a new report that shows U.S. bank retail branch closings increased by a record 38 percent in 2021.
Michigan saw a net loss of 247 banks last year, which was the second most only behind California’s 269.
The S&P Global Marketing Intelligence analysis shows U.S. banks closed nearly 4,000 branches and opened 1,000, for a net loss of 2,927 branches as the pandemic increased digital banking for a second straight year.
“Banks have accelerated plans to consolidate their branch footprints as the Covid-19 pandemic encouraged consumer adoption of mobile and digital channels,” S&P Global’s Zach Fox and Umer Khan wrote in the report. “Further, banks have faced a tough operating environment with low interest rates pressuring margins and forcing a reconsideration of expenses.”
Banks closing the most locations were:
- Wells Fargo & Co., net closure of 267 branches, to 4,894.
- U.S. Bancorp, net closure of 257 branches, to 2,572.
- Truist Financial Corp., net closure of 234 branches, to 2,553.
- Huntington Bancshares Inc., net closure of 221 branches to 1,445.
- Bank of America Corp., net closure of 166 branches to 4,084.
Other banks opened dozens of branches “as lenders continue to use retail branches as a marketing and consumer acquisition tool even while more consumers use digital and mobile services,” the report said.
JPMorgan Chase & Co. opened 169 new branches while at the same time pruning its brick-and-mortar footprint, closing 129 branches on net. The Wall Street titan now has banks in the 48 contiguous states.
Bank of America added 53 locations while still reducing its physical presence.
U.S. banks closed 1,417 banks in 2019, the last full year before the coronavirus pandemic. In 2020, banks shuttered 2,126 brick-and-mortar locations.
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