We had an overflow crowd at our break-out session at BAI Retail Delivery on “What’s Next for the Branch Network?”. Citizens Bank, MidSouth Bank and Coastal Federal Credit Union offered thoughtful and innovative strategies.
- The role of the branch is changing. Consumers and businesses are writing fewer checks and increasingly using direct deposit, remote capture and other means for deposits. As a result, branches will be used more for sales and service, and less for teller related activities.
- Branch distribution accounts for 50-60% of a typical financial institution’s cost structure. There is a tremendous opportunity to improve revenue growth and effectiveness of existing branch networks through improved internal metrics, external benchmarking, and distribution mix refinement.
- Continued growth requires distribution expansion, but picking the right channels, markets, and sites will be increasingly complex.
- Economics will drive a shift to smaller, more cost efficient facilities that need to be managed differently:
- Greater use of technology for remote delivery of service
- Different staff skills: more utilization of universal staff with fewer specialists
- Tighter integration with hub branches or call centers to provide specialized expertise
- Greater emphasis on micro-market knowledge and outside sales calling to improve market penetration
A copy of the BAI Retail Delivery presentation is below, including the case studies from Citizens, MidSouth and Coastal. If you click on the “menu” icon at the bottom of the presentation, there is a link to a download site (or you can request a PDF copy by sending an email request to email@example.com).