Webster Financial Corp., the Waterbury-based parent of Webster Bank, said it plans to close 27 banking centers across Connecticut, Massachusetts and Rhode Island over the next six months.
The bank, the second largest based in Connecticut by deposits, did not disclose any of the 27 specific locations, which amount to approximately 17% of its overall brick-and-mortar footprint.
Webster said it expects to incur pre-tax costs from the consolidation of $19 million, most of it in the current quarter that ends Dec. 31, related to premises and equipment write-offs as well as contractual lease obligations.
Once those costs are out of the way starting in the third quarter of 2021, Webster expects to reduce its annual pre-tax operating expense by approximately $15 million.
Webster said the closures are part of a broader plan to reduce its expense base by 8% to 10% by the fourth quarter of 2021 ‒ a plan that Webster President and CEO John R. Ciulla said last month would be more fully revealed in January.
So far, Webster has said that expense efficiencies in the plan will include flattening its organizational structure, capturing back-office synergies, redesigning and automating critical processes, and consolidating its retail and corporate real estate footprint.
Ciulla said that Webster’s management team began working on the plan back in Jan. 2020, more than a month before the COVID-19 pandemic struck Connecticut, in response to expectations of a prolonged low-interest rate and more challenging business environment.
