Anatomy of Branch Transformation in the Short Term

Branch Transformation Panel Series Part 6
by Bob Meara, May 17, 2017
Other
North America

Abstract

Branch count will go down in the next two years, but large banks will cut branches while small banks add branches.

Celent has released a new report titled Anatomy of Branch Transformation in the Short Term: Branch Transformation Panel Series Part 6. The report was written by Bob Meara, a Senior Analyst with Celent’s Banking practice. 

Overall, there will be fewer bank branches in two years, but only large banks will cut branches. Over half of surveyed banks and credit unions plan to increase their branch count in the next two years.

Larger banks will lead in pruning their networks, while smaller institutions will operate larger networks as they seek growth through footprint expansion. Utilizing branch resources to maximize digital channel enrollment is now every bit as important to surveyed institutions as sales and service effectiveness. Institutions broadly understand the importance of digital, regard digitally driven customers as generally more profitable and loyal, and apply branch resources to increase digital adoption and utilization as a result.

“Banks say customer relationships are their #1 strategic priority, but you wouldn’t get that impression based on what aspects of the branch customer experience are measured (or not measured),” commented Meara.

“For example, less than a third of surveyed institutions (mostly large banks) measure customer wait times or branch employee utilization. Barely two-thirds measure branch channel utilization among customers,” he added.

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned operating unit of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

Executive Summary

1

 

Key Research Questions

1

Short-Term Priorities and KPIs

3

Network Composition and Density

6

 

Network Composition

6

 

Network Density

8

Growing the Ranks of Digitally Directed Customers

13

 

Attitudes Toward Digitally Directed Customers

13

 

Tactics to Increase Digital Utilization

14

ATM Initiatives

17

Recommendations

19

Appendix I: Panel Demographics

20

Appendix II: Survey Instrument

21

Leveraging Celent’s Expertise

26

 

Support for Financial Institutions

26

 

Support for Vendors

26

Related Celent Research

27

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