10.12.21
Branching Out, Digitally, But Rooted in Client Service
by: Irene Yeh, BISA Staff
“We are still bullish on the branch but want advisors to be client oriented versus branch oriented. An advisor should be able to serve a client wherever they live if they are aligned with the client segment or profile.”
One of the unfortunate results of the pandemic was the closing of several businesses. Banks were no exception, with many forced to consolidate or eliminate bank branches across the United States. At the same time, clients have taken to digital channels and apps for services such as depositing checks, paying bills, making transfers and even opening bank accounts.
As shared in BISA’s “Growth Beyond the Branch: The Future of Bank Investment Sales” research report produced by Aite-Novarica Group, “as banks transition sales and services to digital channels, branch traffic and sales opportunities decline, leading to branch closures. Indeed, the branch networks of the banks participating in this research contracted by 5% between the end of 2020 and Q1 2021, with more consolidation planned.”
While it may seem like digital banking has taken over traditional banking, in-person banking—and consequently, bank branches—still have an important role for clients. As more banking activity takes place online and branch networks shrink, the branch’s role is changing from a place that handles transactions to one where customers address more complex financial needs and those related to key financial goals, such as purchasing a home, applying for a small business loan or saving for retirement. Importantly, many community business owners, for example, still use bank branches for loans and cash transactions.
Branches also serve as the meeting place for bankers and advisors to review business opportunities and engage with high-touch clients. This revised view of the role of branches has encouraged many banks to start opening branches in cities with a growing number of affluent households, despite branch consolidation efforts and reducing the number of branches overall. This is in part due to executives’ being more focused today on helping branch bankers evolve to meet these lucrative branch opportunities.
What is sure is that the future of the banking industry is both digital and in the branch. Building out digital capabilities, including both client-facing services and advisor digital selling and service tools, is a top three investment priority over the next 3 to 5 years for 55% of broker dealers interviewed.
Regardless of the environment, advisors must be able to think outside the box, connect authentically with clients, learn new ways of engaging clients and teach newcomer advisors how to be trustworthy and personable to clients both virtually and in the branch.
Want to learn more? Register for the upcoming "Growth Beyond the Branch: The Future of Bank Investment Sales" webinar! Join William Whitt, Strategic Advisor of Aite-Novarica, and Michael Miroballi, President of Huntington Financial Advisors, as they discuss the key findings of the Aite-Novarica Group research report, including diversifying revenue sources, the increased use of digital services and the changing role of the bank branch.
Growth Beyond the Branch: The Future of Bank Investment Sales, commissioned by the Bank Insurance and Securities Association (BISA) and produced by Aite-Novarica Group, discusses how bank-affiliated broker-dealers (BDs) expect to grow in a world less dependent on brick-and-mortar branches. This research report is based on qualitative interviews with 24 bank BD executives and four bank executives who oversee branch investment selling.
BISA members have complimentary access to download the full copy of this report. To learn more about becoming a member of BISA and obtaining the full copy of this report, contact bisa@BISAnet.org.