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Bank of America expanding retail branch footprint to 5 new markets


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Bank of America expanding retail branch footprint to 5 new markets

At a time when digital banking has become a top priority for many institutions, Bank of America Corp. is expanding its retail branch footprint.

During the bank's Oct. 15 third-quarter earnings call, management said the bank has entered four new markets and will be jumping into five more where the bank did not previously have a physical presence. The four markets in which the bank has new physical presences are Denver, Minneapolis, Indianapolis and Pittsburgh. The five markets to be added over the near term are Cincinnati; Cleveland; Columbus, Ohio; Lexington, Ky.; and Salt Lake City.

"The idea is that in these markets, we have customer bases already there and we're putting the branch system in conjunction with the customer bases and the teammates we already have there," said CEO Brian Moynihan. Using the Denver expansion as an example, Moynihan said the company already had commercial banking, business banking and Merrill Lynch employees in the market. He said the Denver branch has gathered $100 million of deposits in three years.

The bank disclosed that it has opened 103 financial centers over the last three years and has plans to open more than 500 new centers over the next four years. At the same time, the bank has been shuttering branches almost as quickly as anyone. In July, August and September, the bank was in the top three banks for most branch closures in the U.S.

"We're trying to build that high-touch, high-tech service model across all the businesses, including the ability for middle-market and business banking clients to have branches nearby ... and so it takes both physical plant and digital," Moynihan said.

CFO Paul Donofrio said the bank has top-three deposit market share in 24 of the top 30 markets in the U.S., and it is looking at reaching a top-three ranking in the remaining six markets.

On the digital side, the bank reported increases in mobile banking and digital transactions. The company reported 42.5 million person-to-person transactions via the Zelle platform, up from 17.8 million transactions in the year-ago quarter. And the bank's portion of digital sales were nearly half from mobile, coming in at 48% of all digital sales in the third quarter compared to 41% a year ago.