Rapid Closure of Bank Branches Inside Supermarkets Signals Industry Shift
American banks are closing branches located within supermarket chains at a rate seven times faster than other locations, as the industry faces profit pressures and customers increasingly shift to digital channels. Regional banks, particularly those hit by the collapse of Silicon Valley Bank, have been under pressure and have closed the most in-store locations. The closure rate for in-store branches was 10.7% in the year ended June 30, compared to 1.4% for other branches. The pandemic accelerated the adoption of mobile and online banking, leading to a sharp increase in branch closures. Banks now view branches as places to attract customers with wealth management accounts, credit cards, and loans, favoring full-sized branches. Despite a slowdown in closures since the peak in 2021, branch closures remain elevated compared to pre-pandemic levels.