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The National Australia Bank (NAB) is investing $100 million in 2021 in a branch transformation program to reportedly adapt to the changing way customers are choosing to do their banking.
The changes include a new design and open plan layout, with meeting spaces for customers to conduct conversations with bankers. In addition, the bank is also installing additional digital services like self-service digital bars, and machines that are available 24 hours a day, which it said is popular with customers.
Furthermore, NAB is opening four new-format branches this year in Barangaroo (NSW), Clyde, Bourke Street, and Collins Arch (Victoria).
NAB announced the opening of the new branches following a trial of its first smaller-format branch in Casey Central Shopping Centre in Victoria late last year.
It has come as the bank’s figures showed that 93 per cent of NAB’s customer interactions now take place via the NAB app, phone, video or online.
NAB’s latest round of investment has followed it investing $60-million in its branch network in 2020 during COVID-19-induced restrictions, which it said hindered its refurbishment plans.
Commenting on the branch changes, NAB group executive personal banking Rachel Slade said: “Our digital-savvy customers no longer need to visit a branch to withdraw cash, deposit a cheque or to pay a bill. They complete these transactions on the go, at a time and location that suits them.
“Customers will benefit from more meeting spaces with video conferencing facilities and a digital bar so we can provide more guidance on the ways to do everyday banking. We’re investing in more smaller-format branches so we can provide a convenient location for customers to have important conversations with experienced NAB bankers, either in person or via video.”
However, while more customers are choosing to bank digitally, branches have continued to play an important role, Ms Slade said.
“When our customers choose to visit us in a branch, it’s to have an in-depth conversation about how we can help them achieve their goals,” Ms Slade said.
“That’s why we are making significant investments in our branch network, redesigning these important locations for the customer experience to be less transactional and more conversational.”
Ms Slade said the major bank would draw on the skills of specialists such as plumbers, electricians, air-conditioning technicians and businesses for the branch transformation, including manufacturing and installing the NAB signage.
NAB to continue to review branch network
NAB’s branch transformations plans have come amid the closure of several branches in Australia as customers increasingly move to digital banking and use online services.
The major bank has provided data to the House of Representatives standing committee on economics in response to questions on notice around how many branches it has closed or has planned to closed in 2020 and 2021, as well as how many branches it would have at the end of 2021.
NAB closed 72 branches during 2020 and 2021 (as at 25 May 2021), and has 548 branches across Australia.
However, the major bank could not provide data around how many branches would remain open at the end of 2021.
It said: “NAB continues to review its branch network on an ongoing and consultation basis, and we therefore cannot state with confidence the size of our branch network at the end of calendar year 2021.”
NAB’s 2021 half-yearly results revealed that it had 646 retail and business banking centres as at 31 March 2021.
In 2020, the major bank partially closed 114 regional branches (with the branches remaining open only in the mornings) as it embraced remote banking.
ANZ branch closures lead big four
The other three major banks have also closed branches across metropolitan and regional Australia.
For example, ANZ closed 145 branches in 2020 and 2021 (with more to follow). This represented the largest number of branch closures among the major banks, according to the data provided to the committee.
As at 31 May 2021, ANZ had 448 branches but this would reduce to 425 with an additional 23 branches due to close, the major bank reported.
In its 2020 annual report, Westpac Group reported that the number of branches in Australia and New Zealand had slumped from 1,143 in 2019 to 1,072 in 2020.
Branch numbers to keep shrinking in 2021: CBA
The Commonwealth Bank of Australia (CBA) closed 53 branches between 7 March 2020 and 27 March 2021, and reported having 928 branches as at 31 March 2021 (839 CBA and 93 Bankwest branches).
It told the committee that it would expect a gradual reduction in branch and ATM numbers to continue over the remainder of 2021, “in line with significant structural shifts in customer behaviour and preferences across a number of sectors, including banking”.
CBA invested $53.8 million in the 2020 financial year to open new branches and renovate or upgrade existing branches.
According to CBA’s 2020 annual report, it had 967 branches and service centres in Australia as at 30 June 2020, down from 1,014 in June 2019 and 1,082 in June 2018.