Source | LinkedIn : By Chris Skinner
Most observers of the banking industry believe that banks do not need branches. Most bankers say that banks need branches. Who’s right? I would bet on the banker, as they’re in the business. However, it is clear that we don’t need as many branches.
A report by the European Central Bank (ECB) in 2013 found that there has been a significant number of branch closures over the last decade. European banks closed around 20,000 branches across Europe between 2009 and 2013, including 5,500 in 2012 and 7,200 in 2011. That represents the closure of about 8 percent of all of Europe’s bank branches since the global financial crisis began in 2008, and the cull is expected to continue for many years to come, thanks to FinTech and digitalisation.
The cuts have been most severe in Spain, unravelling years of expansion by regional savings banks that had given the country the biggest bank branch network in Europe. Its branch numbers were down 17 percent by the end of 2012 from four years earlier but, at just over 38,200 branches, Spain still has more branches per head than any country in Europe—one bank branch for every 1,210 people. France has the greatest number of branches—38,450, or one bank branch for every 1,709 people. France did shrink its bank branch network by 3 percent in the four years to the end of 2012, while 5 percent of UK branches and more than 8 percent of German ones shut down. The number of branch closures is even more dramatic in countries that are already heavily digitalised, such as Denmark, where numbers were down by a third and the Netherlands, which had closed a quarter.