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Banks not closing branchesFocus short
19 May 2014 Compiled by Spectator staff Finances and Advisory
BANKS in Slovakia continue to open new branches despite an increasing number of clients using internet banking. This trend in Slovakia runs contrary to the results of a study by consultancy firm Bain & Company, forecasting that banks in the European Union will close 40 percent of their branch offices, the Sme daily wrote on April 22.
“I do not think that this is real,” Maroš Ovčarik, expert of the Finančná Hitparáda website, which evaluates banking services in Slovakia, told Sme, adding that for some products clients have to go into banks in person. Moreover, deciding over money is to a large extent about trust, in which bank branches and personal contact with client play an important role.
As many as 40 percent of Europe’s bank branches are expected to close between 2013 and 2020 as the ‘digitalisation’ of banking takes hold, says Bain & Company.
In Slovakia the number of bank branched increased a bit over last two-tree years. At the end of 2013 there were 1,256 bank offices and sub-branches. Compared with 2012 their number increased by 13, while in comparison with 2003 this is almost 200 more. The number of employees in banks increased too, to over 18,500.
Ovčarik sees two reasons behind these increases. The first is that clients have to go to a bank in person for certain products, like mortgage loans. The second reason is that banks want to get clients to visit bank branches in person because this gives them an opportunity to persuade clients to buy more of their products.
Banks themselves are not planning any massive closure of bank branches in Slovakia, while the structure of services provided by banks is changing and moving closer to consultancy.
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