It's a cry you can hear in any town in New Jersey whenever the 'coming soon' sign pops up shortly after new commercial construction breaks ground:
“Another bank? Do we even still need them?”
In an era when people actually go into physical banks far less often than ever before — quick, find a teenager and ask them if they've ever actually been inside a bank — you can understand why consumers may be hoping instead for the latest trendy store or restaurant.
But if you ask a banker, the answer is clear: Branches are as important as they ever have been. That's why they keep popping up even as more customers move their banking transactions online.
The branches of today are quite different. They tend to be smaller and require less staff since consumers and businesses increasingly rely on technology to get their banking done. But their core mission remains the same: They make the loans that help the latest trendy stores and restaurants open.
To do that — despite all the modern-day technology — there is a need for a face-to-face conversation. In a branch.
“You still need to sit down with a potential customer,” said John McWeeney, president and CEO of the New Jersey Bankers Association.
“Banks still view branches as important parts of their distribution channel; it's just not the only part.”
We talked to three different types of banks about branches — and how they will impact their business in the future.
Each has a different story to tell.
Here are their thoughts:
Bread, milk, eggs … and a quick deposit.
If you bank at Wells Fargo, this will soon become an option.
Among the new branch models at Wells Fargo are those found in supermarkets.
“(They are) extremely popular out on the West Coast, and now we are bringing them to the East Coast,” said Bill Tullio, Wells Fargo community bank district manager.
Wells Fargo introduced the idea in this region last July at a Shop Rite in Pearl River, N.Y. That store serves part of northern New Jersey.
By the end of the year, Wells Fargo expects to open another branch in a Hackensack Shop Rite.
Tullio said the concept works for both consumers and businesses — and is a way the bank can spread its brand.
“We can reach out to more of the community without having to open up one of those big, traditional (branches) that are very costly,” he said.
And don't be fooled; this isn't an express service checkout lane.
“(A supermarket branch) can do all the functions that the traditional (branch) can do,” Tullio said.
“I think this is something you are going to continue to see as we move into the future as part of the strategy of the bank.”
Sun National Bank recently opened a new branch just off the campus of Rowan University in Glassboro.
And it's unlike most other Sun Banks.
Rather than the 3,000- to 5,000-square-foot plan of bygone days, it's sleeker and smaller, said Sun National Bank CEO Tom Geisel.
“This is 1,500 square feet, and it's all technology driven,” he said.
The ATMs do a lot more than dispense cash; customers use them for a wide range of transactions, while bankers walk around the branch with tablet computers so they can sit down and give customers personal attention.
How new is the model?
Geisel says don't think turn of the century — think 2010.
“It is very different from what we would consider a state-of-the-art branch even two years ago,” Geisel said.
Provident Bank CEO Chris Martin knows more and more banking is done on-line. But he also knows the computer can not replace a branch for everything.
“There is always the case that when someone is looking for a loan, they don't want to apply online: they actually want to have a relationship (with their banker),” he said.
It's one of the reasons Provident will open a branch early next year in the new Teachers Village in downtown Newark.
One that embraces technology.
“There will be smart ATMs out on the floor, and if people are just doing transactions, they can do them at the machine,” he said.
But Martin doesn't discount the human connection.
“If they need an interaction, there will be someone behind the counter to have a conversation,” he said. “They will be there to do what a machine can't do.”
Branches matter because there is no substitute for personal interaction; technology can only do so much, Martin said.
“When you are having any issues, you don't want to click, click, click — you want somebody to talk to.”
We know, we know: It seems like there is a new branch opening every week. In reality, however, openings are trending down ever so slightly.
Peter Ostrowski, a banking consultant whose firm Ostrowski & Co is in Cranford, cited figures from the federal government showing the number of bank branch offices in New Jersey peaked at 3,381 in 2008 and has declined every year since, to 3,241 in 2013.
Ostrowski said New Jersey is in line with the national trend. But don't expect branches ever to go away completely.
More than anything, a branch is branding, something that solidifies a spot in town.
Just ask Steven Klein, the president of the Woodbridge-based Northfield Bank, which has nine branches in New Jersey.
“The branch is an advertisement; your building is your billboard,” Klein said. “Often that's how you get the message out in the community. I think when people say 'Northfield's my bank,' they want to know where their bank is.”
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