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KeyBank plans to ramp up branch closings

KeyBank plans to ramp up branch closings

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KeyBank expects to step up its branch closings this year. (News file photo)

KeyBank expects to close branches at a faster clip this year.

"You'll actually see us step that up this year over last year," said Christopher Gorman, vice chairman and president of banking, in a Thursday conference call. Last year, Key closed 38 branches across its network.

"We feel like we're pretty good at it," Gorman said. "As we went through First Niagara and we rationalized the fleet, we think with the technology, with the digital capabilities that we have, we have the capability to keep our clients and thin out some of the branches."

Key is preparing to close a branch inside the Walden Galleria on March 29. Meanwhile, the bank will open a branch in the Delavan-Grider neighborhood this spring, fulfilling a pledge made as part of its community benefits agreement.

Beth Mooney, Cleveland-based Key's chairman and CEO, called the new branch "a real success story working with the community to make sure we got a location that met the need and that we can also create something that holistically helps really lift a neighborhood."

Branch closings are one piece of Key's plan to trim $200 million in expenses this year, a target which represents 5 percent of the bank's total expenses.

Mooney said Key does not have a specific target for the number of branches it will close this year. "We are using analytics for, where are the traffic patterns, where are people coming and going, how are they transacting?" she said.

For instance, she said, the new East Side branch will be the type of branch where lots of transactions are expected to take place. In contrast, some other branches have become more of a destination for customers to receive advice on financial products, with more transactions happening online.

"We are using data and analytics to figure out where we believe we can have branches that are close enough that one becomes excess capacity," she said.

In 2018, the bank recorded profits of $1.8 billion, up from $1.2 billion in 2017. The full-year results included profits of $459 million in the fourth quarter.

Key has agreed to acquire the online lending platform of Laurel Road Bank. The deal excludes Laurel Road's three physical branches in Connecticut.

The Buffalo News: Good Morning, Buffalo

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