PNC plans to close about 200 bank branches by the end of this year as it seeks to cut costs and focus on using technology to serve customers.
Amy Vargo, a PNC Financial Services Group Inc. spokeswoman, said Friday that decisions are still being made about potential closings. The bank has 2,900 branches in Ohio, 18 other states and Washington, D.C. The Akron-Canton area is home to 50 branches, and Northeast Ohio, more than 100.
Vargo said customers would be notified 90 days in advance of a branch closing.
Customers are “moving toward more convenient electronic forms of banking — online banking, mobile banking” and new kinds of ATMs, Vargo said.
Earlier this year, the Pittsburgh-headquartered bank’s president, William Demchak, said PNC would seek to cut $700 million in expenses in 2013.
Demchak revealed the plan to close the branches at a conference for industry analysts in Boston earlier this week. He said PNC’s branch network represents about one-third of the company’s expenses.
The company closed 65 branches last year and plans to close 32 in the first quarter of this year.
“We’re targeting 200 branch consolidations through the course of ’13,” Demchak said, according to a transcript of his talk.
Demchak said that with advances in ATM technology, web-based banking and the proliferation of mobile apps “customers have less need to visit a branch than ever before.”
At the same time, technology can save the bank money.
Demchak said that depositing a check through the use of a mobile device saves the bank about $3.88 per transaction versus a deposit at the teller window.
He also told the analysts the bank would open branches “where it makes sense to do so in order to create a presence within our markets that might be underserved.”
Vargo said it’s too early to say how many branches the bank will have at the end of this year.
“We evaluate our branch network continuously,” she said. “So every month, there may be decisions made about branches consolidating and also branches opening.”
PNC is among the largest regional banks in the United States by assets.
In 2008, PNC acquired troubled National City Corp. of Cleveland for $5.58 billion, using federal TARP (Troubled Asset Relief Program) money. The program was designed to stabilize financial markets during the Great Recession.
PNC later repaid its TARP money.
Other banks are cutting their branch expenses.
Last spring, FirstMerit Corp. of Akron released a list of eight branches to be closed and one being converted to a drive-up only location. Of the nine branches affected, six were in the Akron area.
FirstMerit also eliminated the position of assistant branch manager at all of its branches and began layoffs at branches and the company headquarters in downtown Akron.
Katie Byard can be reached at 330-996-3781 or kbyard@thebeaconjournal.com.
