SunTrust Banks, Inc.
) plans to shutter nearly 40 of its branches in the first quarter
of this year. The CEO of the company announced the plans to trim
branch network on Mar 5 at a U.S. Financial Services Conference
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As per a Securities and Exchange Commission filing on Mar 5,
SunTrust expects to bring down the total number of branches to
1,580 by the end of the current month from 1,616 at the end of
Besides the closure of these branches in the first quarter, the
company expects more closures in 2013. Most of the closures are
anticipated to come from the company's in-store network. It
expects to cut down the overall number of grocery store partners,
but retain strategic partnerships with key departmental stores
Wal-Mart Stores Inc.
) and The Kroger Co.
The decision to shut down branches comes after a thorough
evaluation of branch infrastructure following the migration of
clients to self-service avenues like mobile banking and online
banking, which reduced cost extensively.
In 2012, SunTrust closed 43 branches as a part of its cost
cutting measures. Under these measures, the company also
retrenched 2,400 employees and slashed the pay of the existing
ones. Since 2010, the branch workforce has been reduced by nearly
SunTrust is not the only bank that has adopted branch closures
and retrenchments to boost the top line. Both big and small
financial institutions have been resorting to such strategy amid
a bleak macro economic environment.
Currently, SunTrust retains Zacks Rank #3 (Hold).