Again, if historical patterns persist, we estimate the branch at in , has a chance closing by mid 2020, and a chance it will close by mid 2025 if it hasn’t already.
In July 2019, this bank had in deposits. Branches of banks with fewer deposits are much more likely too close. For example, among the bank branches with the lowest 20% of deposits in July 2018 (less than about $24 million), over 5% those branches closed by July 2019. Of those in the top 20%, over $120 million, only 1.4% closed.
In 2018, this bank branch had in deposits, that means the value of deposits has by . When deposits declined at a branch from 2017 to 2018, it was 40% more likely to close in 2019.
county had approximately bank branches in 2019. Bank branches in counties with fewer other options don't tend to close as frequently. Lenders are pruning branch networks in places where there’s the most competition, or where greater overlap makes multiple storefronts redundant.
Small towns and counties with just one bank have historically been much less likely to lose their bank than dense urban areas where there were a lot of financial options. The branch is area.
That stickiness in small communities could be a good thing: not everyone is ready, or wants, to do all of their banking on a smartphone. The elderly and some vulnerable groups aren’t always comfortable with or able to use mobile phone apps. Bank branches can help preserve their ability to live independently. Poorer people are also more likely to rely on cash, which requires in-person banking infrastructure.
The Covid-19 outbreak has also highlighted the importance of community banks. Small businesses, many of which only have enough cash to operate for a month or so without financing, are under immense pressure from lockdowns and a shrinking economy. Community banks specialize in lending to smaller businesses and could be a source of support during the turmoil. The branch .
This branch is located in a zip code that was in the percentile of income for your county in 2017. Historically, branches in zip codes with the poorest residents within a county have been most likely to close. From 2018 to 2019, branches located in a bottom quintile zip code, were 7% more likely to close than those in the top quintile. Branches Poorer neighborhoods are more challenging and less lucrative to serve, and the data show banks are choosing to cull in these areas.