Bank branches are shuttering at an ever-faster rate in the New York area while more consumers turn to mobile apps for their financial business.
The number of branches fell 6.8% in the 12 months through June, compared with 2.2% for the same period a year earlier, research by Jones Lang LaSalle Inc. shows. It was the highest rate among all the major U.S. markets in the study, which used data from the Federal Deposit Insurance Corporation.
The area -- including New York City, its suburbs and parts of New Jersey -- “is a very dense urban market in most instances so there’s a lot of potential duplication of bank branches,” said Walter Bialas, director of research at JLL. Mergers and acquisitions in the industry, and the rise of mobile apps that allow banking anywhere and anytime, have also led to a reduction in bricks-and-mortar storefronts.
Across the country, bank branches have been in decline since 2009 after peaking at almost 100,000. More than 13,200 branches have shuttered in the past decade with the industry’s shift to digital platforms, JLL said.
The top 25 banks in the U.S. have more than doubled their pace of closings in the past three years, according to the report. That rate may increase as more property leases expire, leaving landlords with empty space to fill.
Even with less real estate, business is growing for banks. Deposits nationwide rose 4.1% to $12.8 trillion in 2019, JLL said. New storefronts are often smaller, with modern technology.
This article was provided by Bloomberg News.