Branch Closures - What You Need to Communicate to your Customers

by Serra Doll

U.S. branch closings are increasing in record numbers according to 2013 research performed by SNL Financial. This means that the number of communications banks are having to send out are increasing as well, costing them time and money.

The FDIC manages policies that require insured depository institutions to communicate to their customers a certain way regarding branch closings. This article outlines the important aspects of the policy statement, focusing specifically on what banks are required to send to their customers before the closure occurs.

This article is for informational purposes only. Be sure to refer to all associated policy statements and legal documents for complete guidance.

1. Communication Content

MAIL: Insured depository institutions are required by law to notify their customers of the branch’s proposed closing via mail. This means that before a branch closure is/can be approved, communications must start going out to that branch’s customer base.

The institution can mail the communication with one of the customer’s regular account statements OR send it out as a separate mailing.

According to FDIC policy, the content of the communication should include the following:

  • The location of the branch to be closed
  • The proposed date of closing
  • Identify where customers may obtain service following the closing date or provide a telephone number for customers to call to determine such alternative sites.

  • We've provided a free template of this closure notice here.

    ON PREMISE: In addition to individual communications being sent by mail, the institution also has to, “post a notice to customers in a conspicuous manner on the premises of the branch proposed to be closed.”

    2. Communication Timeframe

    MAIL: The notification must be mailed to the branch’s customers at least 90 days before the proposed closure date.

    ON PREMISE: This notice must be made visible on premise at least 30 days before the proposed closure date.

    Automate Your Notices

    I know what you’re probably thinking… “Great, I know what I have to do and when I have to get it done, but it’s still going to be a long process to get it all together and sent out…”

    Fortunately, I can address the last part of that equation as well.

    Core iQ’s Actionable Reporting and End-to-End Fulfillment capabilities, specifically, can give banks the ability to drastically simplify sending these branch closure notices. This can help banks save resources as branch closings in the U.S. continue to rise.

    Of course, there are instances when these communication requirements can vary or the law does not apply. Additional rules can be found in the full policy statement by the FDIC, provided here.

    Sources:


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