Several of the larger financial institutions like U.S. Bank, Union Bank, Wells Fargo, and Chase have acquired smaller financial institutions and made the smart business decisionn to consolidate many of their in-store branches. The main reason is due to over-saturation in the markets they serve. Woodforest National Bank, the nation's leading in-store branch provider, is still opening new locations with a total of 760+ branches nationwide - a few of them open 24 hours a day. U.S. Bank actually closed a significant number of branches over the past 5 years that were duplicative due to their acquisition strategy. This has allowed them to take their bank brand all the way to the east coast in 2021 and 2022 with a combination of in-store and in-line branches.
The Kroger brand, Walmart, H-E-B, Ahold, Albertsons, and Meijer supermarkets consistenly move mountains to attract and retain bank and credit union partners as it enables a one-stop shopping experience for their customers. Banks and credit unions with in-store branching who operate with a universal banker model (employees can perform all banking services instead of being specialized in their job) have found explosive growth and a cost-effective way to enter a new market and establish itself as a branch for the people. With typical transaction totals of these grocery stores between 10K to 25K each month, the bank branches have unfettered access to their competitors' clients on an average of 2.3 times a week which is a winning strategy for growth.
The in-store movement is gaining significant headway with credit unions taking up the mantle. In fact, there have been many acquisitions in the past 18 months where credit unions have acquired banks to expand their footprint (VyStar in Fl, LGE Community Credit Union in GA, Veridian Credit Union in MN, NuMark Credit Union in IL, Barksdale Federal Credit Union in AR, Summit Credit Union in WI, and Orion Federal Credit Union in TN). See S&P Global's complete list here:
https://www.spglobal.com/marketintellig ... t-73498242
The vast majority of credit unions expanding into grocery stores have done so with the help of Financial Supermarkets, Inc.
(
www.supermarketbank.com) who have specilized in in-store bank branching since 1984. Not only does FSI understand the credit union branch experience, they have very close ties to the major retailers (i.e., Walmart, Kroger, H-E-B, Meijer and more) and have the pulse on innovation within the credit union and banking industry. Their unique process helps credit unions open within six months with their patented pre-fabricated branch system which retailers love as it is comprised of green, sustainable products that minimizes impact to the retail environment. While a local contractor can provide a stick-built branch, they do not offer the expertise to navigate the in-store leasing channels and daunting politics within the retail industry or have a complete understanding of how employees and clients interact within the branch environment.
Is bank branching declining across the U.S. in size and style? Yes, however, in-store branching seems to be gaining a renaissance as it solves many challenges financial institutions face such as digital transformation, shortages due to staffing challeges, and access for their brand to be presented to thousands of potential clients weekly. One fact that remains is the bank and credit union branches are not going anywhere. If you hear differently, it is clever marketing spin from Venmo, Chime, and CashApp. It is notable to point out that Millenials and Gen-Z are slowly making a switch from the popular banking apps in turn for a transparent and real relationship with someone they trust to guard their money and assets. Where are these young customers? Why, in the grocery store of course!