Tuesday, October 15, 2013
World of Finance: Branch Banking
I was reading on the internet as to how small towns in the U.S. are struggling with having no branches of any major or local banks in their neighborhoods and how it is hurting the communities. It is not a new phenomena but it has been happening over the years. If you pick up the statistics, the U.S use to have more than 12 thousand banks with thousands more in their branches like 20 to 25 years ago when the internet was not widely available. But with improving technology coupled with rising costs, the number of banks is decreasing with mergers, acquisitions, closings and consolidations making up the bulk of it. And other thing is that all these banks are not being replaced by new banks only some new banks have been opened online and that is a big if they are going to work or not but for now few people are flocking to it since they are not sure if their deposits are safe. I remember the when I was trying to change jobs and I sent out my resumes to small community banks and other small regional banks with branches only in one state and now if you see they are either merged, closed down or sold to bigger banks and this all due to economic circumstances. But while some towns are losing banks and their branches and they have to go further to do their banking activities, some of the richer towns are getting crowded with branches because there is actually where the money is.