Truist Financial plans to reduce its branch network by March as part of its cost-saving strategy. According to recently released data, Truist Financial operated a total of 2006 branches across 17 states and Washington, DC, as of December 29, 2023, and Truist closing branches could amount to around 4% of it.
Although TFC has not disclosed the branch locations that will be closed, recent applications submitted to the North Carolina Commission of Banks indicate that closures are expected in states such as Kentucky, Georgia, Maryland, Alabama, West Virginia, and North Carolina.
The spokesperson for Truist Financial stated that lower branch traffic and transaction volume are the factors behind these closures. Furthermore, they mentioned that nine branches in North Carolina and seven in the Washington, DC, area are scheduled for shutdown by March.
Truist Closing Branches: Key Takeaways
- Strategic Cost-Cutting Initiative: Truist Financial’s decision to close 72 branches by March 2024 is a significant move aligned with its broader cost-cutting initiative of $750 million. This measure is part of the company’s strategic reset and expense reduction plan, reflecting the dynamic adjustments needed to navigate the evolving financial market.
- Geographic Impact: While specific branch locations remain undisclosed, recent closure applications in several states, including Kentucky, Georgia, Maryland, Alabama, West Virginia, and North Carolina, indicate the geographic scope of Truist’s branch closures. The move reflects a nationwide strategy to optimize the branch network based on factors such as declining branch traffic and transaction volumes.
- Operational Streamlining: Truist’s plan involves consolidating commercial and community banking regions, merging consumer and wholesale payments businesses, establishing a unified commercial real estate business, and resizing its board of directors. These measures indicate a comprehensive effort to streamline operations and enhance efficiency as part of the cost-cutting initiative.
- Financial Impact and Timeline: Truist’s cost-cutting plan, led by CEO Bill Rogers, aims to limit the expense rise to no more than 1% in 2024. The $750 million initiative is set to be implemented over twelve to eighteen months, potentially concluding in the first quarter of 2025. The financial impact includes $300 million from job cuts, $250 million from organizational restructuring, and $200 million from reducing expenditures on technology, reflecting a focused approach to achieving financial goals.
Truist Financial’s Strategic Branch Closures: A Staggering $750 Million Cost-Cutting Initiative
Truist Financial has informed customers about its plan to close 72 branches in March as part of its broader cost-cutting initiative. The North Carolina-based company aims to close nearly 4% of its branch network around the States. As of December 29, 2023, Truist operated 2,006 branches across 17 states.
These closures align with Truist’s previously announced $750 million cost-cutting initiative, initiated four months ago. In response to the need for a strategic reset and expense reduction, the 543 billion dollar company has implemented various measures, including consolidating commercial and community banking regions, merging consumer and wholesale payments businesses, establishing a unified commercial real estate business, resizing its board of directors, expanding its executive management team, appointing a new chief operating officer, and hiring a new chief legal officer.
But which branches is Truist closing?
Truist, based in North Carolina, hasn’t yet provided a comprehensive list of upcoming branch closures in response to requests. However, recent closure applications submitted to the North Carolina Commission of Banks indicate impending shutdowns in various states, including Georgia, Alabama, Maryland, Kentucky, West Virginia, and North Carolina.
According to a Truist spokesperson via email, 7 branches are set to close in Washington, DC, and 9 branches are slated for closure in North Carolina. Truist plans to close 8 branches in Georgia, with 4 in Atlanta. These closures are attributed to declining branch traffic and transaction volume. On average, the locations earmarked for closure are about 2.5 miles away from another Truist branch. In the Washington area, the proximity is even smaller, with affected branches situated less than one mile away, on average, from another branch.
After the closures, Truist will maintain operations with over 1,900 branches and 2,900 ATMs. The company has not revealed the number of jobs affected by the shutdowns. Currently the seventh-largest US commercial bank by assets, Truist originated from the merger of equals between North Carolina, SunTrust Banks, and BB&T in December 2019, with headquarters in Winston-Salem and Atlanta.
Initially aiming for annual cost savings of $1.6 billion by the end of 2022, the expenses continued to rise. In July, executives projected a 7% YOY expense increase for 2023, marking one of the highest anticipated upticks among major banks. However, the current cost-cutting plan aims to limit the expense rise to no more than 1% in 2024.
Truist CEO Bill Rogers has outlined that the $750 million cost-cutting initiative will be implemented over twelve to eighteen months, potentially concluding in the first quarter of 2025. The major component, around $300 million, is anticipated to result from job cuts, with an additional $250 million stemming from organizational restructuring. The remaining $200 million will be achieved by reducing expenditures on technology.
Truist is a company that offers banking and trust services, operating across three main segments: Consumer Wealth and Banking, Insurance Holdings, and Commercial and Corporate Banking. The Wealth and Consumer Banking segment provides various solutions, including borrowing, banking, insurance, investing, payments and consumer finance, mortgage, and wealth management.
The Commercial and Corporate Banking segment specializes in strategic advisory, risk management, capital raising, investment and liquidity, financing, deposits, lending, and cash management. The Insurance Holdings segment provides casualty and property, life insurance, employee benefits, and other solutions. Truist was formed through the merger of SunTrust and BB&T.
Ttruist branch closing amounting to a staggering 72 branches by March 2024 serves as a pivotal step in its comprehensive $750 million cost-cutting initiative. This strategic move, aligning with the need for a reset and expense reduction, reflects the company’s commitment to adapting to evolving market dynamics.
While specific branch locations remain undisclosed, pending closure applications in multiple states indicate the broad impact. Truist attributes these closures to declining branch traffic and transaction volumes. Post-closure, the company will operate over 1,900 branches and 2,900 ATMs. The cost-cutting plan, led by CEO Bill Rogers, aims to limit the expense rise to no more than 1% in 2024, focusing on job cuts, organizational restructuring, and technology expenditure reduction.