Worcester Business Journal

June 12, 2017

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wbjournal.com | June 12, 2017 | Worcester Business Journal 13 T E C H N O L O G Y F O C U S It's not hard to reach Us Figure 1 - Tin Can Telephone Equal Housing Lender I Member FDIC | Member DIF At Main Street Bank, we still believe in the power of the spoken word. That's why we offer all our customers a direct line to our employees. No confusing phone trees, just an actual phone number for an actual human being. It's not the usual way of doing things, but that's just fine by us. Let's talk soon — 508-481-8300. North of Ordinary BankMainStreet.com | 508-481-8300 Branches remain vital to banking services On May 22, Berkshire Hills Bancorp, Inc. announced it would acquire the parent compa- ny of Worcester-based Commerce Bank for $209 million in stock, as part of its plans to become a major banking center based out of Boston. However, its plans don't include a significant expansion of brick-and-mortar bank branches. When polled, WBJ readers overwhelming still use the physical branches for the majority of their banking needs. F L A S H P O L L What do you use traditional, brick-and-mortar bank branches for? Only for things like loans or mortgages or to open a new account 26% Everything from deposits and withdrawals to transfers 49% COMMENTS: "I get cash once a month, otherwise we do everything online." "Banking has always been, and will always be, a service. I believe it is far easier to provide service to someone if you meet with them in person. This is why I always try to do my banking in person at my local branch." "I haven't been in a bank in over five years." changing, and in a good way." Branch visitations down San Francisco research firm Gensler found in 2010 two out of three bank cus- tomers said in a survey they go to a branch a few times a year or less. Only 7 percent visited once a week or more. "It was a bit surprising" at the time, said Julie Reker, who leads Gensler's retail practice in Boston and con- ducted the study. "For today, it's not." She found declining in-person trans- actions don't spell doom for brick-and- mortar branches. "We're finding that a physical branch is still important, even if they never physically walk into that branch," Reker said. A sharp drop in the number of physical branches is not expected any time soon. Keefe, Bruyette & Woods, a financial services research firm in New York City, said in a report in April it foresees only very modest reductions – around 2 percent a year – in branch numbers. John Smith, the CEO of DBSI Inc., an Arizona company that helps bank plan or redesign branches, said enough peo- ple still aren't astute or comfortable with technology to forget walking into a bank storefront. "Only about 15 percent of the general public is truly tech-savvy," he said. "The rest of the population looks at all of that with a little skepticism and fear." Still, Smith said, transfor- mation is necessary. Instances of people walking into a branch needing to solve a particular problem are up, he said, so bank employees must have a broader knowledge of how to help people. Among the features he advocates for the self-service kiosks much like the ITMs Berkshire is rolling out in its branches. Citizens Bank, which has more than 30 Central Mass. locations, has acceler- ated its gradual branch renovations, hoping to re-do about one-third of its 1,200 branches in the next three to five years, said Beth Johnson, the company's head of consumer strategy. "Consumers still want to have that personal touch quite often," she said, describing a demand that has guided the branch overhaul. "We want to change the Paulo DeOliveira, relationship branch manager for UniBank look and feel of the network." The Massachusetts bank with the most radical changes to its branches is Capital One. Eight Boston-area Capital One Cafes are more coffee shops than they are banks, with much of the space devoted to couches or other comfortable seating where people can buy Peet's cof- fee and a pastry and use the bank's free Wi-fi. There are 19 such cafe branches, with more on the way. Capital One cafe branches were the result of hearing that in-person interac- tions are still important and that peo- ple weren't always sure where to go for financial questions. "The digital component has made things easier but not changed how money and finances are still a very stressful topic for people," said Jaci Stoltz, the vice president of Capital One Cafes. "We took that feedback and have set out to take the stress out of money for people." UniBank teller Ken Mudzingwa at the Gold Star Boulevard location isn't separated from customers by a glass partition like in a more traditional branch setup. I don't go into the branch at all anymore. I do everything online. 14% Unless a branch is close by I do all my banking online. 11% W

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