Bank Consolidation and Access to Full-Service Bank Branches

The consolidation that took place in the banking industry during the 2000s and 2010s led to an increase in the total number of bank branches per institution and resulted in a larger number of branches to meet customers’ banking needs, according to a study by the Federal Reserve Bank of Cleveland.

Researchers Kyle Fee and Erik Tiersten-Nyman provide evidence that institutions have been increasing their number of branches via consolidation rather than via opening new branches. In addition, their findings indicate that, on average, urban consumers have not experienced a significant change in their ability to access a full-service bank branch, and rural consumers saw full-service branches become more accessible.

“Overall, this analysis suggests that even though consolidation may create fewer choices of banking institutions, it provides consumers access to larger networks of branches and has caused no significant change in a customer’s physical proximity to branches on average,” the authors write.

Read more: Has Bank Consolidation Changed People’s Access to a Full-Service Bank Branch?

Federal Reserve Bank of Cleveland

The Federal Reserve Bank of Cleveland is one of 12 regional Reserve Banks that along with the Board of Governors in Washington DC comprise the Federal Reserve System. Part of the US central bank, the Cleveland Fed participates in the formulation of our nation’s monetary policy, supervises banking organizations, provides payment and other services to financial institutions and to the US Treasury, and performs many activities that support Federal Reserve operations System-wide. In addition, the Bank supports the well-being of communities across the Fourth Federal Reserve District through a wide array of research, outreach, and educational activities.

The Cleveland Fed, with branches in Cincinnati and Pittsburgh, serves an area that comprises Ohio, western Pennsylvania, eastern Kentucky, and the northern panhandle of West Virginia.

Media contact

Doug Campbell, doug.campbell@clev.frb.org, 513.455.4479