First Indy to close Bingen branch

First Independent's data shows that roughly one-third of the account holders in those branches never go into the branch. They may be using other branches nearer their current home, work or school, or they are taking advantage of First Independent's system of ATMs, telephone, online and other electronic banking options.

Renee Newman, senior vice president and director of retail banking, said one of the bank's objectives in closing underutilized branches is to bring its branch-to-deposit ratio more in line with evolving bank industry averages.

"Measured against our peers, we're operating too many branch offices," said Newman. "While we value each and every client, responsibly managing our own organization means we shouldn't maintain branches in areas that no longer have sufficient traffic to justify the cost of staff and buildings -- especially since we offer many other locations and ways to bank with First Independent."

Clients of the three branches slated for consolidation will soon receive letters from First Independent detailing their options, including the location of the next closest branch.

Consolidation dates, which are dependent on regulatory approval, are expected to be:

Nov. 18, 2010 -- Bingen

Nov. 24, 2010 -- La Center

Dec. 2, 2010 -- Woodland

"Banks throughout the country -- including ours -- are seeing more and more financial transactions happening outside the traditional branch," said Newman. "Clients increasingly use ATMs, cell phones and the Internet for banking and bill paying, and use their debit cards for purchases and cash back."

She added, "we're adjusting our delivery channels to match those habits and insure that we have all of the service channels appropriately covered."

First Independent's experience reflects broad national trends in banking. Industry analysts suggest that check-related transactions in branches will drop more than 50 percent between 2002 and the end of 2010.

Meanwhile, smart phones are enabling dramatic growth of mobile banking. Financial services industry analysts at the TowerGroup say mobile banking is growing at an annual rate of more than 50 percent and will have 53 million users by 2013.

In a 2009 study of banking customers by the American Banking Association, more than 30 percent indicated that they preferred the speed and convenience of online banking to branch banking.