Data from the Virginia-based SNL Financial revealed this week that banks across 42 states experienced more closings than openings in the past year, with a total of 767 bank and thrift branch closings.
Pennsylvania took the lead as the state with the most number of bank closures at 83, followed by Georgia at 51 and Virginia at 46. Illinois lost a total of 22 branches statewide, Chicago Tribune reports.
Bank of America experienced the most closures with 157 closings across the country.
As consumers turn to traditional banking alternatives, banks have begun to shrink networks and staff.
“Our customers continue to do more with us through all the channels, including traditional branches, mobile, online and ATM, but they’re using the branches less, and that’s why we’re fine-tuning our delivery network,” Bank of America CEO Brian Moynihan said, according to Chicago Tribune.
The bank said that the branch closings were part of an effort to cut costs as increasing regulatory pressure begins to take hold. Bank of America has approximately 5,600 branches, but the institution has plans to reduce the number of branches to under 5,000 sometime in the future.
CEO Mitchell Feiger of the Chicago-based MB Financial Bank said that the bank has closed several of its locations throughout the past five years.
“We’ve done a nice job investing money in our branches and relocating some that needed to be relocated, and closing those that need to be closed,” Feiger said, adding that if U.S. deposits remain stable, “having as many branches will probably become less necessary, but we’ll look at that as time goes by,” Chicago Tribune reports.
Not only have voluntary bank closings resulted in a lower number of branch locations across the country, but fewer financial start-ups in the U.S. have also led to a reduced branch count. In 2005, there were 135 bank start-ups. Following the recent financial crisis, however, that number fell drastically to zero start-ups in 2011.