Andrea Principe, managing director – Northeast division director – consumer banking, Chase, took to the stage at Future Branches in Boston to explore how while the banking industry faces challenges in sustaining core deposits, deepening customer trust, and building relationships, it is important to learn from failures, reengage with customers, and provide exceptional in-person experiences.
Across the US and worldwide, there is a need to balance technology and human connection in branch banking, and adapt branch networks to cater to various customer segments. Additionally, banks’ community development initiatives should be bolstered to build trust and offer financial support to underserved communities.
Chase's branch strategy, focusing on client relationships and digital investments
Speaking to Janis Avila, customer experience strategist and former banker, Principe provided an overview of Chase’s presence in the Tri-State area – New York, New Jersey and Connecticut and advocated for investment into digital platforms, as well as into the physical branches in the future. As previously reported, Chase will open 500 branches over the next several years and refurbish 1700 of their 4800 branches within the next few years.
“We continue to invest in our branches, because we know that our clients come. If you look at Chase, we are the first bank to be in all lower 48 states and we're very proud of that. We accomplished that within the last year or two and we have almost a million clients that visit our branches every day. Clients are telling us that the branches are important,” Principe said.
Denying suggestions that younger generations do not utilise physical bank branches, Principe shared that a staggering 84% of their Gen Z customers enter the brick and mortar establishments, as well as 67% of millennials. She added that their customers, when making life decisions, prefer to speak to the team in person.
“Opening accounts is not a big life decision for us as bankers, but it is for many clients. It's opening accounts, it's IRAs, it’s retirements, its home lending and small business clients. 85% of our small business clients visit our branches once a month. We have a lot of interaction. When clients want to make those decisions or need to make those decisions, they want to have a face to face conversation with someone.”
Training branch employees for exceptional in-person service
Human connection and trust-building in banking is more important than ever before. Principe explained that Chase has changed its approach to hiring and roles to prioritise client service. The bank also focuses on building skills and competence in its employees to better serve small business clients. The One Chase team approach involves a holistic approach to client service, with specialists from different departments working together.
Principe said that the bank is focusing on “engaging our employees to be really good at building relationships with clients. And we've changed the way that we hire, we change the way we think about these roles.” Instead of tellers, Chase is hiring what they refer to as associate bankers. While tellers can complete transactions for clients and customers, associate bankers “help our clients become more digitally savvy by teaching them so we continually train them if there's new digital products and solutions that we're rolling out.”
Further, by ensuring that all bankers are trained in relationship banking and licensed, skills and competence grows. Principe shared that “we always say when a business client walks through the door, we don't want our team running away from the client. We want them running to the client, right? And in order for them to run to the client, we have to give them the skill set and the tools to help those clients. So we focus on simplifying, making things easy, making things digestible.” This is where the One Chase team comes in.
Evolving branch networks to appeal to diverse customer segments
Principe also spoke about how Chase plans to expand their community segment to support small business clients in low- and moderate income (LMI) communities, that was launched in 2019. Efforts include building trust in underserved communities through dedicated community branches, financial workshops, and small business consulting. Because of this, Chase has seen higher deposit growth and approval rates in these communities due to targeted education and training, with over 4000 small businesses benefiting.
By hiring small business consultants, they consult with emerging and small businesses. Principe mentioned that in branches where these services are available, deposit growth has been over 10% higher than traditional branches. She believes this is “because of the guidance we provide and we spend a lot of time talking to them about marketing, operations, how to run your business, how to hire people, how to make sure you're hiring the right people, how to be more efficient. Because with these small business owners, they know their craft, they don't know finances, and or how to run a business.”
Chase's strategy and growth plans
In her concluding comments, Principe stated that Chase will “continue to double down on branches. We are committed to branches, it's been our strategy. If you ever hear Jamie [Dimon] talk, he will always talk about the branches. We're opening our third community branch in New York in the next couple of weeks in Brooklyn, but we opened one in the Bronx and he [Dimon] was there. To have the CEO show up for a community branch opening in the Bronx, it shows you how committed we are to this.
“60% of the US population is within a 10 minute drive of a Chase bank. Our goal is to get that to 70% of the US population,” Principe said. She went on to say how when considering setting up new branches, it’s “about having the right branches serving the right communities with the right customers.”
Being the largest US bank by total domestic deposits, Principe revealed that Chase branches become profitable within five years of opening, on average, and in some cases, three years.