Bank of America BAC continues its aggressive branch expansion across the United States as part of a broader strategy to solidify customer relationships and tap into new markets. The bank, on Monday, announced plans to open more than 165 new financial centers by 2026-end, with nearly 40 set to open this year.
This move aligns with BAC's commitment to broaden its retail presence and offer enhanced in-person services. The latest openings include Bank of America's first financial center in Louisville, KY, with plans to establish four additional centers by 2025. The bank's efforts are part of a broader goal to serve more customers and communities across 63 markets.
This new wave of expansion follows the branch network growth plans announced by Bank of America in June 2023. That plan focused on entering nine new markets, including Omaha, Boise and Milwaukee.
Strategic Reasons for BAC’s Expansion
The ongoing expansion of Bank of America's branch network is not just about increasing its physical footprint but also adapting to evolving consumer behavior. Although 95% of its client interactions occur digitally, the bank has seen a growing demand for in-person appointments for more complex financial needs.
Customers are using these visits to discuss life goals, investments and mortgage options with financial specialists. Bank of America noted that in the past year, roughly 10 million appointments were scheduled, with 20% related to investment advice. This shift toward in-person advisory services seems to be driving the company’s focus on opening new centers in key markets.
Over the last decade, Bank of America has spent more than $5 billion in renovating its financial centers, ensuring a consistent and modern experience for its customers. These upgrades include creating spaces where clients can engage with financial advisors and utilizing technology to streamline everyday banking tasks.
The investment in brick-and-mortar locations is seen as a critical tool for deepening relationships with customers, especially in underrepresented areas like low- and moderate-income communities, where BAC’s 30% of the new centers are located.
BAC Boasts the Third Largest Branch Network
Bank of America's expansion update comes as other large banks are similarly reinvesting in their branch networks. These initiatives signal a broader trend in the banking industry, where physical branches are increasingly viewed as vital hubs for wealth management and business banking rather than just routine banking transactions.
JPMorgan JPM, the nation's largest bank by assets, plans to open 500 new branches by 2027, expanding into areas like Boston, Charlotte and Washington, DC. Currently, JPM leads the United States in branch count, with more than 4,800 locations.
Wells Fargo WFC, with around 4,200 branches, occupies the second place in the country in terms of number of branches. WFC is also focused on renovating and modernizing its locations, prioritizing customer experience and advisory services.
Among the regional peers, PNC Financial PNC is also pursuing a branch expansion strategy. PNC plans to open 100 new locations while renovating almost 1,000 of its existing branches.
Our Take on BAC’s Branch Expansion Plan
As digital banking continues to dominate everyday transactions, Bank of America's branch expansion highlights the importance of in-person advisory services for complex financial needs. The bank's strategic investment in new financial centers and its push into new markets reflects a broader industry shift toward optimizing branch networks to deepen customer relationships and tap into new business opportunities.
In this competitive environment, the ability to blend digital convenience with in-person expertise is expected to give Bank of America long-term leverage in the evolving banking landscape.
Shares of Bank of America have rallied 18.4% this year, underperforming the industry’s appreciation of 19.8%.
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Currently, BAC carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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