By Neil Haggerty
Fifth Third Bancorp said it plans to consolidate or sell about
100 of its branches and about 30 other properties, a move that
comes as mobile and electronic banking grow in popularity.
Since the financial crisis, U.S. banks have been ramping up
mobile and online services and moving away from physical locations
to avoid overlap, and branch numbers have been on a steady decline
as a result.
At the same time, increased scrutiny of consumer lending and
tougher capital requirements are expected to continue to push banks
to consolidate branches.
The Cincinnati-based regional lender said it expects to book $75
million to $85 million in write-downs in the second quarter, along
with $6 million to $10 million in other costs, primarily related to
real estate contract terminations.
The moves are expected to save about $60 million a year.
Culling branches, with their real-estate, labor and security
costs, has become a popular way for banks to boost profits. Like
other lenders, Fifth Third has faced pressure on its mortgage
business as prolonged low interest rates have limited interest
income and prompted cost-cutting.
As of March 31, the company had $140 billion in assets and
operated 15 affiliates with 1,303 full-service banking centers.
Write to Neil Haggerty at neil.haggerty@wsj.com
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