Apr 30, 2017

Sunday Focus: The Bank.

     Regions closed two branches in my part of Alabama on Friday.      
     One in Selma, the other in the Cloverdale neighborhood.



     When a bank branch closes, it impacts the entire neighborhood.
     Less foot traffic can mean fewer customers for nearby stores

     Regions is keeping the ATM at the Cloverdale branch in operation, but people driving through aren't likely to shop at another store if they don't actually park.
 In all, regions is closing some two dozen branches in this round, including those two. Regions is headquartered in Birmingham.

    They were two of thousands of bank branches that have closed across the country in recent years. The banks blame...yup...millennials. Not entirely. But a story in The Atlanta Journal says the younger generation's lover affair with everything on the smart-phone is a contributing factor:

"Bank experts say much of the consolidation has resulted because of the increasing popularity of online banking, debit cards and other remote options among customers, especially the under-40 crowd."

Once a branch closes, the building tends to remain vacant. One Amsouth branch on McGee Road in Montgomery is still for sale after it closed.


A White paper titled "The Last Branch in Town examines the impact of a branch closing in rural areas like Selma (There is still one other Regions branch open in Selma.) :

"Branch closures also affect businesses and communities. Small businesses value proximity to their bank since they may need to deposit cash frequently or depend on relationships at the local bank for loans. The relational nature of small business lending means less access to capital for small businesses and entrepreneurs when banks close branches. One study of bank branch closings by a Berkley economist found that branch closings lowered small business lending by 8% for several years after a closing.16 The post-closing decline in lending was more severe in low-income and high-minority census tracts, indicating that they are disproportionately affected by closings.17 "


     Not all bank branch closings result in an empty building. Compass moved their Dexter Avenue Branch to a Commerce Street location, and that building has been purchased. No immediate word on what will happen to it, but online leasing information indicates it is available for lease as an office building, and one floor may have already been leased..

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