September 6, 2004
Crain’s Chicago Business
Bank branches keep coming
Citigroup, B of A plan Chicago expansions
Citigroup Inc. and Bank of America Corp., the nation's Nos. 1 and 3 banks, plan major Chicago-area branch expansions, adding to the region's existing bank glut and promising consumers still more cash and merchandise enticements to open new accounts.
Chicago banks opened 83 branches in the year ended June 30, 2003, bringing the total to 2,249, according to the Federal Deposit Insurance Corp. In the prior 12 months, there were just 30 new bank locations.
"The availability of good corner locations in the Loop, Michigan Avenue, Near North and North Shore is extraordinarily limited and picked over," says David Stone, president of Stone Real Estate Corp., a Chicago retail real estate brokerage.
Still, banks press on, seeking stable consumer deposits and often-lucrative consumer loans. Citigroup, based in New York, wants to as much as double its 50 local Citibank branches and has just begun scouting sites, people familiar with the bank's plans say.
"Our senior management has said we would like to expand our (consumer banking) business," a Citigroup spokesman says. "Chicago is one of the areas where we have branch operations and is a place we're looking around." He wouldn't elaborate.
Charlotte, N.C.-based Bank of America, meanwhile, last week named a new consumer executive to accelerate its nearly 2-year-old retail entry into Chicago. "We want to speed up our plans," says Angela Birmingham, a senior vice-president who is relocating from Kansas City, Mo., to manage B of A's Chicago consumer business.
B of A, which has 16 Chicago-area branches now and expects to add at least 10 before yearend, will boost its current goal beyond having 50 branches in Chicago, she says. She wouldn't elaborate.
Others, of course — Seattle-based Washington Mutual Inc., Cincinnati-based Fifth Third Bancorp, Cleveland-based Charter One Financial Inc., and B of A — have been snapping up city and suburban sites for the last 18 months.
And longtime hometown players — particularly Bank One Corp., but also Harris Trust & Savings Bank, and LaSalle Bank N.A. — have responded to the out-of-town challenge with land grabs and building campaigns of their own.
"Many of the most desirable suburban towns have since placed a moratorium on banks in their communities, which is an obstacle Citibank's competitors did not initially have to face," says Mr. Stone, the real estate broker.
Mr. Stone is among those in the real estate business contacted recently by the Chicago office of real estate firm Staubach Co. on behalf of Citigroup about potential bank sites.
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