Bank landlords face 30% branch office closure

Bank landlords face 30% branch office closure
Bank landlords face 30% branch office closure

 

Bain & Company's Boston-based head of global banking Gerard du Toit forecasts the accelerating adoption of mobile banking services will result in accelerated bank branch office closures.

 

He suggests Australia's big four banks will come under pressure to close up to 30% of branches over the next three to five years.

 

"Visits to Australian bank branches were down almost 10% in the September quarter compared to the same period two years earlier, but the percentage of transactions done via a teller was still twice as high as in the most digitally advanced markets," Bain & Company's Boston-based head of global banking Gerard du Toit told the Australian Financial Review.

 

"Everything suggests this market has more branches than it is going to need five years from now.

 

"It is hard to say how many closures there will be but global trends indicate a possible reduction of 10% to 30%". 

 

Bain & Co's latest annual report on global trends found that the adoption of mobile banking services accelerated rapidly in the past year.

 

But it warns banks to get the technology right.

 

Mr du Toit said Australian banks should learn from the Netherland's ABN Amro which halved its branches over the past three years without losing market share having spent five years ago with branch staff focused on training customers, especially babyboomers up on how to use self-service options.

Jonathan Chancellor

Jonathan Chancellor

Jonathan Chancellor is one of our authors. Jonathan has been writing about property since the early 1980s and is editor-at-large of Property Observer.

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