Bridgeport-based lender People’s United Bank, which has a major presence in Greater Hartford, announced Thursday a major shakeup of its branch strategy, saying it plans to close its Stop & Shop grocery store outposts in Connecticut and New York over the next few years.
People’s United Chairman and CEO Jack Barnes said the bank has decided not to renew its existing in-store branch contracts with Stop & Shop, but there will be no immediate impact to customers as the exit is anticipated to occur over several years.
People’s United currently operates 84 Stop & Shop branches in Connecticut and 56 in New York.
“Recent acquisitions have allowed us to optimize our branch footprint and as a result, our Stop & Shop branch distribution closely mirrors that of our traditional branches,” Barnes said. “Customers will maintain nearly the same access to a nearby traditional branch, augmented by our digital banking channels where they can conduct many of the same transactions as they would in a branch 24 hours a day.”
The Stop & Shop locations have provided value to the bank over the years, Barnes said, but customer banking preferences and retail shopping behaviors have evolved, especially with the significant rise in digital banking.
People’s United said it will use the cost savings to invest further in its digital capabilities, including its mobile app and online banking, and strengthen its traditional branch network.
Nearly 80% of in-store Stop & Shop branches are located less than 5 miles from a current traditional branch location, the bank said.
Connecticut bank branches have been declining in number for the past decade, and closures reached new highs during the past two years.
But don’t expect a mass wave of branch closures in the state either.
Despite more consumers banking online in recent months, bankers say brick-and-mortar outposts remain key assets that allow for more complicated and high-value business with customers, such as issuing mortgage or commercial loans.
Strong 4Q performance
People’s United on Thursday also released its fourth-quarter earnings, announcing that its profits in the October through December period rose 51%.
Its fourth quarter profits rose to $207.7 million, or 49 cents per share, vs. $137.5 million, or 31 cents per share, in the year-ago period.
During the quarter, People’s United completed the sale of its insurance agency to AssuredPartners, which led to a pre-tax gain of $75.9 million.
Deposits during the quarter grew 5% from Sept. 30 to $2.5 billion.
For the full year, People’s United reported profits of $572.6, or 1.32 per share, vs. $520.4 million, or $1.27 per share, in 2019.
