Banks closing branches in Nevada, across nation

Nevada continues to lose bank branches as the industry trims down and services get increasingly electronic.

There were six net branch closings statewide during the third quarter, according to recent data from SNL Financial. In Nevada, there have been 11 net branch closing in the past year, leaving 519 bank branches statewide as of Sept. 30. Through the first nine months of the year, no new bank branches were opened in the state.

The SNL report found that banks and thrifts have closed a net 1,462 branches across the country during the past year. The majority of closings have come from large banks, such as Bank of America and JPMorgan Chase &Co.

Net branch closings by Bank of America have totaled 148 in the past year, according to SNL. Earlier this year, Bank of America sold 10 rural branches to Washington Federal Inc., including branches in Beatty, Elko and Hawthorne.

Bank of America has said its goal is to reduce its branch count to about 5,000, as part of a company initiative to reduce its operating expenses.

JPMorgan Chase has decreased its branch network by 41 branches, and Wells Fargo closed 16 branches. Citigroup has sold or closed about 90 branches over the past 12 months. John Gerspach, chief financial officer of Citigroup, told analysts during a third-quarter conference call that ongoing cost reduction initiatives “drove total operating expenses down slightly year-over-year to $2.4 billion.

“We continued to resize our North America retail banking business in the third quarter, taking costs out of our mortgage operations and rationalizing the branch footprint, all while continuing to grow our franchise,” Gerspach told analysts.

Those reductions in Citi’s mortgage business have led to more than 750 layoffs at its Las Vegas mortgage operations over the past year. The company eliminated the last 220 customer service and technology jobs at its sprawling campus at The Lakes in western Las Vegas.

But most of the closures have affected rural Nevada, as Washington Federal is pulling out of Beatty, Pioche and Hawthorne. All three branches were purchased from Bank of America earlier this year. The branches closed earlier this month, leaving residents in Beatty, for example, with an ATM where they used to have a branch.

In a two-page letter to customers, Washington Federal said all accounts will be transferred to the nearest branch. In Beatty’s case, the nearest Washington Federal branch is in North Las Vegas, or 109 miles away.

Banking analysts believe the downsizing of bank branch networks will continue next year, as more customers use online bill pay, or apps to conduct their banking transactions.

Meanwhile, as the number of branches shrinks, wait times are getting longer. According to a study by Financial Management Solutions, the average time spent waiting in a lobby rose from four minutes and 46 seconds to five minutes and eight seconds.

Combined with service representative assist times, the average visit to your local branch is 26 minutes and 58 seconds. So, as more branches close it seems the problem will only get worse, leading more customers to avoid branches.

A Bankrate.com survey earlier this year found more than a fifth of Americans said they hadn’t been in a bank branch in more than a year, and 70 percent said they hadn’t been in a branch in the past week.

BancAccess eyes Nevada

A veteran Tennessee banker is looking to make it easier for community banks to make commercial loans.

Benn Rudd, the former president of Heritage Bank &Trust in Columbia, Tenn., has created BancAccess to connect community banks with business loans through a cooperative system. Rudd told the Las Vegas Business Press that his new concept took a year-and-a-half to gain regulatory approval.

That approval was granted about two months ago. Rudd said BancAccess has placed a single loan in Las Vegas, but is not doing any business with community banks in Nevada.

Rudd said he hopes to gain regulatory approval in Nevada soon. The idea is to give small banks — many of which are back to profitability, but are looking to increase asset base since the Great Recession — access to commercial and industrial loans they wouldn’t be able to handle on their own because of the large costs.

BancAccess works by processing prospective loans from customers, run a credit analysis and add them to a database for banks. From there, banks can decide whether to finance a loan alone or take a piece of the credit alongside other banks.

BankMobile testing banking platform

It’s not as well-known as Wells Fargo or Nevada State Bank, but a division of Consumers Bank plans to begin beta testing in December on its no-fee, branchless banking mobile and tablet banking platform.

Based in Las Vegas, BankMobile will use the responses of its first 5,000 customers that sign up for the mobile platform to develop its final business plan. The online and mobile bank is offering free checking, with a high-yield savings account and lines of credit.

The apps are available for Android and Apple devices, the company said.

Access to financial consultants who will provide basic financial education specifically geared toward millennials will be available. Millennials were born in the early 1980s to the early 2000s.

Other features include rates on savings accounts at least 0.25 percent higher than the nation’s four largest banks, no overdraft fees, and access to credit lines up to $5,000.

CEO Jay Sidhu said BankMobile’s success is collective. He described BankMobile as the bank of the future and said the beta testing “has been eagerly anticipated, and the executives are excited to enter this important phase for the bank.”