The big business of banking is getting a little smaller, at least when it comes to brick and mortar locations in West Michigan.
This month, Midland-based Chemical Bank announced plans to close 38 branches in Michigan and Ohio. That also means cutting 230 jobs.
These banks are closing for the same reason many big-name retail store chains are facing financial trouble, the internet.
"There's no real reason why it'll stop and there's no real reason why we'd want it to stop, but some people will be adversely affected," GVSU professor, Dan Giedeman, said.
Say goodbye to your banking branch and hello to your smart phone, the way we 'bank' is changing.
"Ever since the financial crisis in 2009, we've seen the number of branches fall at about 10,000 across the country," the economics professor added.
Chemical Bank is the latest company to announce local closures.
According to bank officials:
- The Main Street branch in Zeeland has been consolidated to the Riley Street Branch.
- The South Washington Avenue branch in Holland will be consolidated into the downtown branch.
- The Fennville location will be consolidated into the Saugatuck branch.
"I think it's pretty clear that the trend is going away from sort of the brick and mortar buildings and towards the electronic use of banking," Giedeman said. "Where you get a check, you take a picture of it and it's already deposited into your bank account."
Giedeman says the impact of these closures will be subtle but also significant.
"The pay-day lenders move in instead of branches and its' harder for local businesses to get started because they can't walk in and say, 'Hey I'd like to get a loan' they have to go further afield and then it's harder to obtain those loans."
But not all financial institutions are suffering. While regional and national banks may see some slow down, Michigan credit unions are on an upswing. Reports show membership and lending for area credit unions are outpacing national averages.
"A lot of it has to do with market conditions. So if you're in the area where the economy is growing, you'll likely to see branches going up there."
CFO of Chemical Bank, Dennis Klaeser says many of the staff at these branches will just transfer to another bank. He adds, despite these closures, the company is growing, just in different departments.