Bank of America will continue to trim branches as it remains focused on lowering its overall expenses, a top executive for the Charlotte-based bank said Friday.
“We will bring our financial centers down,” Dean Athanasia, co-head of Bank of America’s consumer banking operation, said in a presentation at a banking conference in Boston, where he’s based.
Bank of America is getting rid of branches in areas where foot traffic is low, while still opening smaller branches in other markets, such as Denver and Minneapolis, he said. Since CEO Brian Moynihan took over in 2010, Bank of America has shed more than 68,800 jobs and 1,200 branches, which the bank refers to as “financial centers.”
“It’s not how many financial centers you have in your network,” Athanasia said. “It’s where they are,” among other factors, he said.
“We can get more and more efficient as we go and look at where our financial centers are placed and make sure we’re in the best areas,” Athanasia said.
Bank of America, like other banks, has reduced its branches as more customers use smartphones to conduct routine banking business once done at teller lines. Athanasia said the bank has been investing in its digital operations because mobile and online transactions cost Bank of America one-tenth of what it does to conduct the same transactions in a branch.
Amid changing consumer preferences, Bank of America is opening higher-tech branches that are smaller but that also feature “specialists” such as mortgage lenders, Athanasia said. In one type of smaller branch that Bank of America calls “Express Centers,” teller lines have been replaced by ATMs that allow customers to talk via video screen to a teller in a call center.
“The teller line is no longer the feature of a financial center, because you can do that on your phone,” Athanasia said. “The design is completely changed.”
Athanasia also noted the large number of employees Bank of America has cut in recent years, as high legal costs and low interest rates have affected its earnings.Just last week, the bank said it was eliminating about 100 jobs in Charlotte, as it continues to reduce staff that handles problem mortgage loans and makes cuts in its technology and operations unit.
In the consumer banking operation alone, employment has fallen by more than 11,600 as of the end of the third quarter, compared with a year ago, Athanasia said.
The second-largest U.S. bank by assets employs about 15,000 people in the Charlotte metropolitan area across a variety of business lines.
One of Moynihan’s 13 direct reports, Athanasia oversees the consumer banking operation with Thong Nguyen, who is based in Charlotte. The operation has generated 35 percent of the bank’s revenue so far this year, Athanasia noted, the largest percentage of any of the bank’s units.
Responding to an analyst’s question about the culture inside Bank of America, whose top executives are scattered across the U.S., Athanasia said Moynihan has “built a collegial environment.”
In January 2010, more than half of the bank’s 11 highest-ranking executives, including Moynihan, worked in Charlotte. After Chief Financial Officer Bruce Thompson left his post in August, just over one-third of the 14 top executives are based in Charlotte.
Moynihan lives in Boston but has his main office in Charlotte. Athanasia described the bank’s management team as “very tight.”
“We get along with each other. We interact with each other. We can find each other,” he said. “It’s a great team.”