3 Popular American Bank Chains Are Closing Branches And The Reasons Couldn't Be Clearer

Recently, a popular east coast banking chain, TD Bank, announced the closing of 38 branches across at least 10 different states. And now, several nationally recognized institutions such as Bank of America, Chase, and Wells Fargo have also notified the proper authorities of upcoming branch closures. 

Bank of America had the dubious honor of closing the most branches during 2024. It closed 168 to be exact and appears to be carrying some of that momentum into 2025, with nine new closures scheduled between February 7 and March 14. Coincidentally, Chase also filed the necessary documents to close nine branches during the exact same time period as Bank of America.

Finally, Diario AS reports that Wells Fargo has closed 23 branches in 11 states so far in 2025. Furthermore, the historic California-based institution recently filed to close an additional 32 branches going forward. The reason why so many banks are shuttering branches is a combination of dwindling asset values, increased regulatory oversight, and the increased popularity of mobile and internet banking — all of which are discussed in greater detail below. 

To be sure, the trend of bank branch closures shows no sign of slowing. In fact, the ratio of bank branches to customers is currently at a level not seen since 1995. In comments to the Daily Mail, digital marketer Darren Kingman explains, "There's no doubt we're moving towards a cashless society but this increase in people per bank branch and the fact over 200 million Americans still make cash deposits will only mean longer wait times in banks and a potentially a lower overall customer experience."

In particular, the elderly can be most affected by a nearby bank branch closing, since they may not be as tech savvy as younger Americans when it comes to mobile banking apps and a future that involved increasingly mobile payments. However, senior citizens are not alone in preferring brick and mortar bank branches to transacting on a smartphone screen. According to Statista, "the share of bank account holders who processed banking matters in person in a branch was 45 percent in the fourth quarter of 2024." Granted, that's eight full percentage points less than approximately five years ago, but today's 45% is still a formidable number. 

Consumers should note that the Federal Reserve requires banks to notify customers in writing at least 90 days ahead of time when the decision is made to close a local branch. At that point, a customer can decide to adapt to the closure or perhaps switch to a different institution with a more convenient branch. And hope that new bank branch remains open.

It goes without saying that the world is going increasingly digital. This, in spite of the fact that some customers might prefer a brick and mortar experience when it comes to potentially sensitive financial matters. If banks continue their march toward technology, reluctant customer may have to learn to adapt to transacting via smartphone and the like. As well, the COVID-19 virus is partly to blame. Business closings during the shutdown and social distancing laid bare that physical branches weren't totally necessary to keep the banking world turning. 

Also, the higher interest rates of late — necessary to help fight inflation — have hurt banks' bottom lines. As interest rates rise, existing bonds and other fixed-income investments with lower interest rates are worth less money. That's to compensate for the lower yield versus ambient interest rates. In the extreme, the devaluation of a bank's investment portfolio can result in a bank failure like Silicon Valley Bank in 2023. On a smaller scale, budget constraints can lead to the closure of underperforming branches. 

Lastly, there's increased regulatory oversight in place following the late-2000s housing crash that led to the Great Recession, especially from the FDIC which insures deposits against loss up to a certain amount. While perhaps a necessary evil, such regulations are burdensome and costly for banks to maintain. That puts pressure on limited financial resources.