The Financial Column — Bank Branch Strategy: Multi-line vs. Thin Networks

2011-01-10

The traditional branch is no longer viable — 40% of bank branches are not making money.

Bank branches are becoming more expensive to operate, while bank products generate less revenue, and customers are spreading their business across multiple institutions. The traditional branch is no longer viable. It’s no wonder that 40% of bank branches are not making money today.

From a financial perspective, new-form bank branches in high potential markets will generate significantly higher balances, margins and profitability because there would be more account consolidation among customers, greater opportunities to sell more, and lower transaction costs, while improving the customer experience. This should increase customer retention, which contributes significantly to profitability.

Back to Videos

Back to Multimedia