Digital online banking trends prompt KeyBank to close four Maine branches
Photo / Maureen Milliken
This KeyBank branch on Whitten Road in Augusta will be the closest KeyBank branch for Winthrop customers whose hometown branch will be closing in the next few months.
The move to digital and online banking has prompted KeyBank to close four of its 49 branches in Maine within the next few months.
Branches in Bethel, Guilford, Winthrop and Wilton will be consolidated with branches in nearby towns, said Karen Crane, senior communications manager for KeyBank.
KeyBank has nearly $2.5 billion in deposits, giving it the fourth largest deposit market share in Maine, at 8.44% according to Federal Deposit Insurance Corp. data in June.
“As any business does, KeyBank continually reviews the structure of our organization to ensure we are meeting our clients’ needs, while maintaining a strong position in the market and meeting our company’s business objectives,” Crane said in an email Thursday. “Over the past few years, we have seen a steady increase in customer preference for online, digital and mobile banking. In response, we are making greater investments in technology to enhance these services; at the same time, we are optimizing our branch network when it makes economic sense.”
The company isn’t disclosing how many employees will lose jobs related to the branch closings, which will happen April 19.
Bank branch closings are becoming more prevalent as technology makes branches less necessary, Lloyd P. LaFountain III, supervisor of the state's Bureau of Financial Institutions told Mainebiz in 2017.
"It's an evolution in the financial world," said LaFountain. "It has to do with what makes sense."
LaFountain said Thursday that his bureau regulates state-chartered banks, but since Cleveland-based Key Bank is nationally chartered, it doesn’t come under his bureau’s oversight.
He said that the figures for bank, credit union and other state-chartered financial institution branch closings and openings in the state have been fairly consistent over the past two years.
From Nov. 1, 2016, to Oct. 31, 2018, six new branches opened, three institutions relocated branches, and four were closed, according to the bureau’s annual report. The previous year, six opened, four relocated and seven closed, and year before that, two opened, one relocated and six closed.
Customers on the move
Crane said customer accounts will be transferred automatically to a another branch, with no action needed from the customer, though those with safe deposit boxes will have to before the contents.
The move includes:
- Accounts at the Bethel branch, 96 Main St., will be transferred to the Norway branch, at 369 Main St.
- Accounts at the Guilford branch, 2 Hudson Ave., will be moved to the Newport branch, 63 Main St.
- Accounts at the Winthrop branch, 107 Main St., will be moved to the 23 Whitten Road branch in Augusta.
- Accounts at the Wilton branch, 300 Main St., will be moved to the branch at 119 Congress St., Rumford.
The move will mean more of a trip for some customers than others. While the Winthrop to Augusta move is less than 9 miles east on U.S. Route 202, the distance Guilford customers will have to drive will be 27 miles. Bethel Key Bank customers will drive 23 miles to their new location and Wilton customers will drive 21 miles.
Customers in the Winthrop area, which is in the capital area, have more options if they chose to switch banks than those in Bethel, Guilford and Wilton, which are in more rural areas of the state.
LaFountain said that while the branch closing trend isn’t limited to rural areas, it’s felt more in them. But he added, the bricks and mortar presence often isn’t necessary.
"More and more we're seeing an online presence, it's more prominent," he said. "You really don't need to enter a brick-and-mortar bank to do many banking functions."
Chip Kelley, KeyBank’s Maine president, recently told Mainebiz that an economic downturn could be lurking, despite some broader good economic news.
"Despite all this good news, I believe we will face a contraction/recession in 2019 or 2020. Fortunately, the deeper, broader and more rooted our economy becomes the better we'll be able to withstand the impending contraction/recession,” Kelley said.
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