RobertB
16 July 2007, 04:39 PM
The Straight Dope folks have the answer -- kinda -- to one of the questions that frequently pops up on the forum.
Why are banks opening so many branch offices?
http://www.straightdope.com/mailbag/mmultiplyingbanks.htm
Dear Straight Dope:
What's with all the banks opening on every corner? I've even seen a bus converted to a mobile bank. Is there really a need for all those branch banks in the era of the Internet or is this some kind of scam? —Andy Ville
The answer, as supplied by "SDSTAFF Gfactor" (not by Cecil Adams himself), is pretty much "because they can". There's no excuse like a requirement to have a certain amount of assets; they're just building branches for the same reason that Walgreens and CVS are building new stores.
In fact, the answer goes into detail about the history of "branch banking" in the US, and fleshes out some of the statements we've made about how banks used to be prohibited from establishing out-of-state branches. It doesn't really tell why banks feel they need to outnumber Walgreens. But it's a good article, so give it a read if you're curious. Just don't expect the answer to why Capitol One might look at the old Hard Rock Cafe and see a sleek new drive-through.
Why are banks opening so many branch offices?
http://www.straightdope.com/mailbag/mmultiplyingbanks.htm
Dear Straight Dope:
What's with all the banks opening on every corner? I've even seen a bus converted to a mobile bank. Is there really a need for all those branch banks in the era of the Internet or is this some kind of scam? —Andy Ville
The answer, as supplied by "SDSTAFF Gfactor" (not by Cecil Adams himself), is pretty much "because they can". There's no excuse like a requirement to have a certain amount of assets; they're just building branches for the same reason that Walgreens and CVS are building new stores.
In fact, the answer goes into detail about the history of "branch banking" in the US, and fleshes out some of the statements we've made about how banks used to be prohibited from establishing out-of-state branches. It doesn't really tell why banks feel they need to outnumber Walgreens. But it's a good article, so give it a read if you're curious. Just don't expect the answer to why Capitol One might look at the old Hard Rock Cafe and see a sleek new drive-through.