Illinois records more bank branch closures than openings

US banks closed more Illinois branches than they opened but increased their number of full-time employees in the state.

In the 12 months ended April 30, banks recorded 64 net branch closings in Illinois, as they shuttered 90 branches and opened 26, resulting in 3,730 active branches in the state, according to S&P Global Market Intelligence data. As of March 31, there were 76,437 full-time employees (FTEs) in Illinois-based bank branches, up 17.3% year over year.

Overall, US banks recorded 1,366 net closings in the 12 months ended April 30, with 2,307 branches closed and 941 opened. Their total FTE count was 2,128,044 as of March 31, representing a yearly increase of 1.9%.

Branch closures across the US have slowed compared to the torrid pace of closures during the COVID-19 pandemic as banks have attempted to strike a balance between increasing digital adoption and maintaining physical locations.

Most active net closers, net openers

JPMorgan Chase & Co. was the top net branch closer in Illinois with 12 closings and only one opening as of the 12 months ended April 30.

JPMorgan will build more branches than it will shutter as it continues a market expansion strategy that has been driving deposit share outperformance, executives said May 22 at the company's investor day.

PNC Financial Services Group Inc., Associated Banc-Corp and Old National Bancorp tied for the second-most net closures in Illinois with six each.

PNC anticipates bank branch traffic to keep declining across the country.

"We'll adjust our physical footprint and increase our digital footprint if that's what clients demand as that continues to happen," Chairman, President and CEO William Demchak said April 26 during the company's 2023 annual meeting of shareholders.

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Commerce Bancshares Inc. ranked third with five closings and no openings. The company is focused on growing its digital channel, President and CEO John Kemper said April 19 during the company's 2023 annual meeting of shareholders.

"We're making a lot of technology investments these days," Kemper said. "This area has been a real focus for us in recent years as customers have shown more appetite for digital interaction."

Several banks were tied as the most active net openers in Illinois with one branch opening each, including Wintrust Financial Corp. and Western Alliance Bancorp.

Quarterly trend

During 2020, banks booked a record number of net branch closings amid the COVID-19 pandemic.

Data from 2020 to the first quarter of 2023 shows that net branch closings in Illinois were the highest during the fourth quarter of 2020 at 67. Net closings in the state were the lowest in the third quarter of 2020 at nine.

Banks logged the highest number of FTEs in Illinois in the first quarter of 2023 and the lowest in the second quarter of 2020.