American bank holding company PNC Financial Services Group has decided to shutter 280 branches by the end of 2021, in the wake of the Covid-19 pandemic.
Initially, the bank had planned to close 80 to 90 branches in 2020 as part of its aim to boost digital sales. However, the ongoing pandemic has accelerated this plan.
At a virtual conference hosted by Barclays Capital, PNC chairman and CEO William Demchak said that it would close 160 branches this year and 120 branches in 2021.
These cuts represent 12% of the bank’s nearly 2,300 branches, according to its financial data.
Demchak said: “You will see us continue to thin out our network. For that to work, your digital sales have to pick up at a pace that offsets the sales you would get at the branches you are closing. So far, that is happening and then some.”
The pandemic has led more consumers to adopt online banking. As a result, banks are launching digital banking products and services and cutting down their branch network.
PNC is opening quasi-digital “solutions centres” in the place of few branches, where customers can consult with staff while using mobile workstations, ATMs and kiosks.
Demchak said that the bank has so far opened 13 centres, with plans to open 12 this year and 25 next year.
Demchak added: “What Covid has done for us is it has showed us where to prioritise investments.”
At the same conference, KeyCorp chairman and CEO Chris Gorman also said that its retail banking arm Key Bank will trim its branch network.
Key Bank currently has 1,077 branches in the country after already closing 61 branches last year and 21 branches this year.
Gorman did not disclose how many branches would be permanently shut.
Associated Banc-Corp, a bank holding company, is also planning to close or sell 21 branches, representing 8% of its branch network.