Bank of America Corp (BAC), JPMorgan Chase & Co (JPM), Wells Fargo & Co (WFC): Why We Still Need Bank Branches

Banks need to balance cost with efficacy
The BAI study makes it clear that cutting too many branches could conceivably damage the relationships that banks enjoy with their small business customers. Meanwhile, reducing their presence in less wealthy communities keeps those areas from rebounding economically, and also prevents the banks themselves from taking advantage of any revival that could be sparked by low business start-up costs in areas hard-hit by the recession.

Some banks are figuring out how to keep their costs down while providing much-needed branch services. Wells Fargo & Co (NYSE:WFC), for example, has introduced ultra-small sites in the Washington, D.C. area, and is placing branches inside Kroger grocery stores in Atlanta.

Big regional bank PNC Financial Services Group Inc (NYSE:PNC) has set up a small, mobile “pop-up” branch in the same city, which will be placed in an area with high foot traffic until November. Despite its tiny, 160 square-foot dimensions, the movable office will feature interactive ATMs and two on-site banking specialists.

When it comes to achieving success through branch banking, the winners may find that size matters less than location, location, location.

The article Why We Still Need Bank Branches originally appeared on Fool.com and is written by Amanda Alix.

Fool contributor Amanda Alix has no position in any stocks mentioned. The Motley Fool recommends Bank of America and Wells Fargo. The Motley Fool owns shares of Bank of America, JPMorgan Chase, PNC Financial Services, and Wells Fargo.

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