Bank of America ATM count down 10% in Moynihan cost-cutting binge
Carving out more costs from its retail operations, Bank of America Corp. has shut down more than 1,500 automated teller machines this year, a regulatory filing shows -- about 9% of its network.
The reductions leave the Charlotte, N.C., bank, once the nation’s largest as measured by assets, with 16,220 ATMs at the end of June. JPMorgan Chase & Co., currently the largest bank by assets, has more than 18,000.
Bank of America’s ATMs peaked at about 18,100 in the second quarter of 2010, 10% higher than current levels.
The closed ATMs were mainly at non-bank locations, including Valero Energy Group gas stations and Simon Property Group malls. Most only dispensed cash, bank officials said Monday, contending that BofA remains a fan of full-service ATMs that enable customers to deposit funds and perform other functions.
“We’re going to continue to add full-service ATMs,” spokeswoman Tara Burke said. She added that that the bank would continue to provide cash-only ATMs at airports and that the numbers probably would begin to edge higher again now that the plug has been pulled on the sites BofA deemed unnecessary.
In a retrenchment aimed at slashing $8 billion from annual expenses by mid-2015, Bank of America Chief Executive Brian Moynihan is focusing on customers who maintain higher balances and use multiple BofA services.
The downsizing and cost-cutting has helped the bank shrink its way to higher profits, but analysts are raising questions about where future revenue will come from.
Bloomberg News, which spotted the ATM decline in the fine print of a BofA earnings supplement, quoted a consultant as saying the cost of an ATM at a non-bank location averages $1,700 a month compared with $1,100 at a bank branch.
The earnings supplement also provided snapshots of other trends in BofA’s consumer and small-business banking division at the end of the second quarter. Despite its retrenchment, deposits rose 2% to $476.6 billion from $467.2 billion a year earlier.
The number of BofA mobile banking accounts increased more than a third over the course of the year, jumping from 7.6 million to 10.3 million.
Burke said the bank will announce mobile applications Thursday that will enable iPad, iPhone and Android smartphone users to deposit money by taking pictures of checks. The function has proved popular at other banks.
BofA on Monday also said it was introducing chip technology on many credit cards aimed at international travelers. Many countries outside the United States have already converted from magnetic stripes to chips that store encrypted account information, creating problems for American travelers using the older technology.
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