Bank branches axed as customers move online, APRA data

The data revealed 309 bank branches were closed nationally in the last financial year alone, with 96 branches closed in NSW, 57 closed in Queensland, and 88 closed in Victoria.

Around 95 were closed in regional Australia.

Over the past five years, the number of banks available has reduced from 5,694 as at June 2017, to 4,014 as at June 2022, marking 1,680 closures.

APRA’s annual authorised deposit-taking (ADI) Points of Presence data statistics comes after the federal government handed down its final Regional Banking Taskforce report (30 September), which was set up by the previous government to measure the impact of bank closures on regional towns.

Upon receiving over 400 submissions from the public on the topic, the taskforce found banks could “do more” to communicate with individual communities when closing a branch and recommended services through Australia Post need to be maintained going forward.

The fall in branch closures marked a 7 per cent decline in the 2022 financial year, which was slightly less than the 9 per cent drop reported in the previous year.

As more people move towards digital banking, the data also revealed more than 1,300 ATMs were axed across the country, which reflected 402 closures in NSW, 362 in Victoria and 259 in Queensland.

Western Australia also saw a hefty amount of ATM closures of 168, while the figures were slightly softer in other states.

APRA’s data followed calls from the community and federal and state governments for “better information” on access to banking services, with the first release of the annual points of presence statistics in June 2001.

Customer preferences changing

More recently, Bankwest announced the closure of 14 east coast branches following customers’ preferences growing towards digital banking and broker services.

“Customers increasingly expect us to be simpler and easier to bank with via their brokers and our digital and contact centre channels, so it’s critical we meet these expectations,” Bankwest executive general manager, Jason Chan, said.

“We’re exploring how we continue to get the balance right between supporting those customers who want to use branches while delivering the digital services customers expect of us.”

While the closures do open doors for regional brokers to fill the gap and provide credit advice to customers, the Finance Sector Union (FSU) said it leaves communities decimated.

The comments by the FSU followed the announcement that Westpac Banking Corporation (Westpac) had the union of 23 branch closures across Australia.

FSU national secretary Julia Angrisano said Westpac has announced the closure of 95 branches over the past four months leaving staff at every branch that remains, fearful that their bank will be the next to close down.

“This is the most appalling decimation of a branch network by a bank which is now on the verge of abandoning its social contract with the community,” Ms Angrisano said.

“The Bank of Melbourne, Bank SA and St George brands are being hit hard and may well disappear if the current rate of closures continues.

“This latest round of closures is why we need the Federal Government to set up an inquiry into the closure of bank branches, especially in regional areas, where they have a devastating impact on retail and business customers.”

[Related: Banks told to do more amid regional closures]