Banking competition ramps up in Charlotte as another major bank plans to debut branches

Charlotte’s banks will soon have another big player to compete with for customers.

U.S. Bank said it plans to establish a branch in uptown — the Minneapolis-based bank’s first in North Carolina. The branch is expected to open in the fall at 201 S. Tryon St., in the former space that housed Dean & Deluca. It’s one of 10 branches that U.S. Bank expects to open in Charlotte by the end of 2020.

In making the move, U.S. Bank becomes the second mega-bank to announce plans this year to establish branches in Charlotte. Last month, JPMorgan Chase said that it plans to have branches in the city by the end of this year.

JPMorgan is the largest U.S. bank by assets. U.S. Bank is the seventh largest.

The decision will expand U.S. Bank’s presence in Charlotte, where it employs about 800 in the region. U.S. Bank has had operations in Charlotte since a 2005 deal to acquire corporate trust and other units from Charlotte’s Wachovia.

Executives for U.S. Bank said the branches are part of a strategy to better serve markets where it already has customers in its mortgage, indirect-auto lending, credit card and other businesses.

In Charlotte, the bank has tens of thousands of such customers, said Tim Welsh, the bank’s vice chairman of consumer and business banking. “It’s a vibrant and rapidly growing market,” he said.

‘The human connection’

U.S. Bank did not disclose where the nine additional branches will go. U.S. Bank is in the process of filing its application for expansion in North Carolina with the Office of the Comptroller of the Currency, the bank said.

North Carolina will be the 26th state where U.S. bank has a retail banking presence, the bank said.

On Monday, U.S. Bank said that, in addition to entering Charlotte, it is pursuing a project that will result in approximately 60 to 80 new, relocated or redesigned branches by the end of 2020 in the bank’s core U.S. markets. It’s not yet known if the bank plans branches outside of Charlotte.

Those plans reflect the banking industry’s desire to continue making branches available to customers, even as banks close branches in other markets. Banks have typically shed branches in places where foot traffic has plummeted because of rising customer reliance on mobile-banking technology.

“What we’re finding across the country is that there’s no doubt many, many customers are engaged digitally with banking,” Welsh said. “But what we’re also finding is that many, many customers want the convenience of being able to go into a branch, first of all, to get help on the digital (tools).”

Branches also remain popular places for customers to get advice, he said.

“You really need that human connection there,” Welsh said.

Growing presence

The Charlotte branch plans mark the latest expansion by U.S. Bank in the city, one of the bank’s major employment hubs. U.S. Bank has about 12,000 employees in Minneapolis.

About a decade ago, U.S. Bank had approximately 100 employees in Charlotte, according to the bank. Today, its Charlotte operations include corporate and commercial banking, investment services, risk and compliance, and mortgage banking.

“We believe that this is the perfect time for us to be able to establish in a small and strategic footprint in Charlotte branches that will allow us to connect with many, many more customers,” said Dee O’Dell, U.S. Bank head of consumer and business banking for the Eastern U.S.

“What you see here is a commitment on the part of U.S. Bank to be in most important growth markets,” he said, adding that Charlotte is high on the list of cities where the bank plans to expand.

Dee O’Dell.jpg
Dee O’Dell, U.S. Bank head of consumer and business banking for the Eastern U.S.

O’Dell said U.S. Bank will continue to grow in Charlotte, although he declined to speculate on future employment in the city. “Part of the reason that we have grown so much in Charlotte is because there’s such a great pool of talent here,” he said.

U.S. Bank also plans to continue investing in Charlotte philanthropy, O’Dell said.

Over the past decade, the bank and its employees have invested more than $2 million to improve the Charlotte community, and employees have contributed thousands of volunteer hours, the bank said.

Crowded marketplace

It remains to be seen how U.S. Bank and JPMorgan will fare in a market where Bank of America and Wells Fargo hold about 90 percent of the region’s deposits.

Charlotte’s banking landscape could see future shifts following a planned $66 billion merger involving BB&T and SunTrust Banks. The combination of BB&T and SunTrust is expected form the sixth-largest U.S. bank by assets and deposits.

U.S. Bank’s announcement means that Citigroup is poised to be the only one among the five largest U.S. commercial banks without a branch in Charlotte.

U.S. Bank executives said they are confident that the bank’s digital tools introduced in the past several months, including a new digital app, will help it to compete.

In addition, O’Dell pointed to U.S. Bank’s thousands of Charlotte-area customers who are already doing business with the bank. Once the Charlotte branches open, U.S. Bank will be able to encourage those customers to use them, he said.

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Deon Roberts has covered Charlotte’s financial services industry for The Charlotte Observer since 2013. His beat includes Bank of America and Wells Fargo. He attended Loyola University in New Orleans and is a native of Lafitte, La.