Bank branches are almost exclusively for advice. But in an increasingly beautiful atmosphere.
Jean Claude RaemyEditor Economics
This caused concern, mainly among older customers: Credit Suisse (CS) recently announced that it would close 14 bank branches by February 2023. Other banks are also considering closing branches, according to a Blick survey of the 20 largest Swiss financial institutions.
Swiss people have been increasingly using online and mobile offers for their banking transactions for years and are visiting bank branches less and less. Looking back on the last ten years, the bare numbers look unpleasant: At the beginning of 2012, the banks surveyed were still operating 2,384 branches in Switzerland; at the beginning of 2022, it was 1,799. That corresponds to a decrease of 585 branches or around 25 percent!
And there is no end in sight to this decline, as the recent example with Credit Suisse suggests. The big bank is not alone. Bank Valiant will open five more branches in 2022 and three more in 2023. But as part of a program to increase profitability, it will also close 23 branches that are close to each other from the end of 2022.
This is where the most was mined
The lion’s share of the branch reductions in the last decade is primarily attributable to the big banks and the Raiffeisenbank. At UBS, the number of branches fell by around a third, at CS by almost half – and this includes the integration of NAB (Neue Aargauer Bank). This network is reduced again with the 14 announced closures. However, Credit Suisse maintains that it is present in all regions of Switzerland with a “network of branches tailored to customer demand”.
The remaining branches would also be developed “away from counter business towards a modern meeting place”. There is a similar trend at Bank Cler, formerly Bank Coop, towards counter-free lounges with advice couches and coffee machines. Cler calls it the “bank branch of the future”.
The largest net reduction was at Raiffeisen, with 278 branches, or almost 25 percent fewer. According to Raiffeisen, the accessibility of the branches has not suffered as a result, 90 percent of the Swiss population can still reach a Raiffeisen branch within ten minutes by car. The geographic presence will also remain high in the future. This also while maintaining the «consulting bank» concept, in which there is no need for a counter hall.
However, Raiffeisen attaches importance to the fact that the number of full-time positions in the group is growing inversely proportional to the branch reductions: While 8167 people were still employed at Raiffeisen with 1098 locations, there are 9729 with 820 locations.
The development at Postfinance is also interesting: in 2007 there were still 28 branches, in 2012 there were 45. In the meantime, the old size has been restored.
|Bank||Number of branches on 01/01/2012||Number of branches on 01/01/2022||difference|
|Banque Cantonale Vaudoise||67||59||-8th|
|Lucerne Cantonal Bank||27||24||–3|
|St. Gallen Cantonal Bank||37||37||0|
|Bern Cantonal Bank||77||55||–22|
|Aargau Cantonal Bank||30||32||2|
|Graubünden Cantonal Bank||70||46||–24|
|Basel Cantonal Bank||16||11||–5|
|Thurgau Cantonal Bank||30||29||-1|
|Banque Cantonale Fribourgeoise||28||26||–2|
|Banque Cantonale Genevoise||22||21||-1|
|Schwyz Cantonal Bank||23||22||-1|
Here was even increased
If you look at the cantonal banks, you will notice that very little was reduced here. On the one hand, this has to do with a statutory performance mandate for the cantonal banks. But that does not prevent the downsizing: At the Zürcher Kantonalbank (ZKB), 45 percent of the branches were eliminated, primarily small locations and agencies with limited services. The Berner Kantonalbank was also reduced by almost 30 percent net; at the Graubündner Kantonalbank by as much as 35 percent. As a result, the cantons with the largest geography and population have declined. For most of the others, the reductions were more cosmetic in nature. In some cases, the total number of employees in the branches has even increased.
The broad presence in the respective canton remains an important differentiating feature. The Schwyzer Kantonalbank, for example, explains: “Our presence throughout the canton is an important advantage that our competitors are less and less maintaining.”
For its part, Migros Bank is growing through cooperation with the post office: by using the post offices, it is opening up regions that it previously did not cover with its own branches. In addition, the opening of additional, own branches is also conceivable.
No foreign services in bank branches
Which leads to the question of why banks still need the branches at all. Some of the branches at many banks have been converted into ATM locations. As a result, the cash business remained regionally anchored without requiring staff. Branches with staff are mostly only required for consulting services. It deals with topics such as mortgages, pensions, inheritance or financial planning. Payment transactions, on the other hand, hardly ever take place physically.
The remaining payment banks will be pimped for this. ZKB, for example, has been testing “new interaction options” since March 2021 at the Zurich-Stettbach train station and in a concept branch opened in Winterthur in June 2022. Credit Suisse and various cantonal banks have also launched new branch concepts. Most banks have also expanded the customer contact options: video advice or other online direct channels are offered as well as personal visits at home. A lot is also invested in the stronger focus on advice – around 8 to 10 million francs per year at the Thurgauer Kantonalbank.
An extension of the tasks to non-banking services is currently not planned. In other words, the banks stick to their core business and the financial needs of their customers. Achieving additional business with other services, as is sometimes done in post offices or travel agencies, is not an issue.
The only question that remains is how far the dismantling will go. None of the banks surveyed wanted to commit themselves to a “minimum number” of bank branches.