Some financial institutions are decreasing their branch footprint as bank clients increasingly adopt digital offerings while Bank of America and JPMorgan are investing in their branch capabilities to meet evolving client needs. 

The case for expanding branch networks lies in evolving customer preferences, the role of the branch and tailored solutions, Joe Myers, executive vice president of global banking at retail bank technology provider Diebold Nixdorf, told Bank Automation News. 

“We have to understand that a lot of banks have leveraged the reduction of the regional footprint or their branch-based footprint as a mechanism to improve their efficiency ratio [and] reduce cost,” Myers said. 

The 2,400 branch closures in 2023 were the most since the 2008 recession, according to cash management solutions company Integrated Cash Logistics. 

While adding digital offerings can streamline the banking experience and reduce costs, there is still a need for adviser-client relationships found in bank branches, Myers said. 

“Our bank clients are trying really hard to build a journey that is about customer convenience,” he said. “Moving into that trusted adviser position is where banks are looking to go.” 

BofA invests in brick and mortar

To that end, $3.2 trillion Bank of America recently announced plans to open 165 new branches across the country by 2026, with 40 to open by yearend, according to a Sept. 23 release from the bank. 

In the second quarter ending June 30, the bank’s footprint totaled 3,786 branches, down less than 3% year over year, according to the bank’s earnings presentation. 

“We are reaching more and more clients through the expansion and modernization of our financial centers,” Aron Levine, president of preferred banking at Bank of America, said in the release. “While most clients are using our digital capabilities for their everyday banking, they are visiting our centers for in-person conversations about their more complex financial needs and advice on their life priorities and financial goals.” 

Since 2014, Bank of America has invested more than $5 billion in branch expansion  and renovation, according to the release. 

Banks are moving into “markets that they haven’t previously accessed very well, and that they believe there’s a vein in which they can mine to expand their business” and add ways that customers can access banking needs, Myers said.  

Chase in Iowa

JPMorgan Chase in August announced plans to open 25 branches across Iowa by 2030, according to a release from the $4.1 trillion financial institution. 

“Creating customer journeys differentiates the bank,” Myers said. “The idea is … giving access and allowing people to bank when they want to bank [and] giving them the ability to choose” what solutions they want to use. 

JPMorgan will announce its third quarter earnings on Oct. 11 followed by Bank of America’s earnings announcement on Oct. 15.