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Capital One, Wells Fargo lead the way with US bank branch closures in October

U.S. banks and thrifts opened 73 branches and closed 371 branches during October, according to S&P Global Market Intelligence data, which does not include temporary bank closures, such as those caused by the COVID-19 pandemic.

As of Oct. 31, there were 84,775 active branches in the U.S. Over the last year, U.S. banks and thrifts have closed 2,664 branches and opened only 1,092.

Throughout the industry banks are closing branches to cut costs as more customers embrace digital platforms. Recently, banks have been reevaluating their branch networks as the consumer transition to digital has accelerated during the pandemic.

Capital One Financial Corp., which closed 68 branches in October including 26 in New York and 15 in Texas, has been rationalizing its branches for some time. Capital One significantly expanded its online deposit-gathering capability with the 2012 purchase of ING Bank FSB, and the company has continued to pursue digital offerings that can help it compete against branch-based retail banks, according to Chairman, CEO and President Richard Fairbank.

"Rather than try to build a bank through 100 acquisitions and with branches on every corner, we're trying to sort of anticipate where the market's going and build the bank of the future and hope the world over time comes toward us," Fairbank said according to a transcript of a February investor conference presentation.

Wells Fargo & Co. closed 61 branches across 18 states in October. Texas saw the most closures for the bank at 11 followed by Colorado and Oregon at six apiece. Branch consolidation is part of Wells Fargo's near-term expense reduction plan, the company noted in an October investor presentation.

Fifth Third Bancorp opened a net four branches in October, more than any other bank in the country. Fifth Third will continue to open branches in its existing "high-growth Southeast markets," but the company plans to close 37 branches in the first quarter of 2021, predominantly in the Midwest, the company's former CFO Tayfun Tuzun said according to a transcript of an October investor conference call.

"The recent acceleration in customer digital adoption trends raises the returns in our technology investments made over the past several years," Tuzun said. "This gives us increased conviction that we can continue to optimize our branch network while also expanding our presence in high-growth markets."

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Click here to access a template containing bank branch openings and closings for October 2020.