Thursday, September 26, 2013

Bank of America sells most branches in 2013, report says

Bank of America has sold more branches than any other U.S. bank so far in 2013, as the Charlotte-based bank continues to slash expenses, a report shows.

SNL Financial said the bank had sold 118 branches in six deals as of Sept. 17, giving up $4.05 billion in deposits in the process. None of the sales were in North or South Carolina.

At a distant second was SKBHC Holdings, which sold 15 branches totaling $257.7 million in deposits.

The volume of branches sold by Bank of America underscores its efforts to cut costs.

The company is about two years into a massive companywide cost-cutting program known as Project New BAC, under which it has also been shedding jobs. In the second quarter, the bank's employee headcount fell another 2 percent, hitting just more than 257,000. That pushed the bank beyond the 30,000 job cuts executives targeted when the Project New BAC process began.

In discussing second-quarter results with reporters in July, Chief Financial Officer Bruce Thompson said the companywide headcount numbers will continue to fall as the bank shutters branches and reduces the number of delinquent loans it manages.

In July, SNL reported that Bank of America has dropped more branches over the past four years than any other bank, with half of them in areas where the median income is below $50,000.

In one of the deals this year, the bank sold 24 branches with $778.8 million in deposits and $7.7 million in loans to Indiana-based Old National Bancorp. Bank of America's biggest branch deal this year, in terms of number of locations, involved Washington Federal Inc., which bought 51 branches, according to SNL.

SNL said overall branch deals have declined this year as banks and thrifts opt to consolidate and close locations rather than sell them. SNL said one reason for the drop is that banks no longer want to shrink their footprints in a market or their size.

SNL said 2013 is on pace to end with roughly 79 U.S. branch deals, down from 88 last year and 81 in 2011. So far this year, there have been 56 deals involving the sale of 240 branches.