Bank of America is planning to shrink the company’s 6,100-branch network by about 10%,
a pullback from the two-decade expansion that took the bank from coast to coast the move is primarily due to consumers preference to online and mobile banking.
Chief Executive Kenneth Lewis told investors the plans during a meeting Thursday, according to people familiar with the conversation. Liam McGee, president of Bank of America’s consumer and small-business bank, also said branch closures are in the works but added it would be premature to specify how many locations could be closed, these people said.
The driving force for the closings is changing customer preferences as online and mobile banking take transactions away from traditional branches. Messrs. Lewis and McGee didn’t say when the closures would occur.
At the end of 2008, Bank of America’s retail-banking operations covered about 82% of the US population, with its red-and-blue flag logo in 13 of the 15 fastest-growing US states and 32 states overall. The company holds 12.2% of all US deposits, according to SNL Financial, followed by Wells Fargo and J.P. Morgan Chase.
In the 1990s, Bank of America pushed ahead with a branch-building strategy as rivals scaled back, believing that the corner branch was crucial to the bank’s overall strategy. Acquisitions since 1998 also added to its heft in California, Florida, the Northeast and the Midwest.