Branch (banking)
Encyclopedia
Retail
Retail consists of the sale of physical goods or merchandise from a fixed location, such as a department store, boutique or kiosk, or by mail, in small or individual lots for direct consumption by the purchaser. Retailing may include subordinated services, such as delivery. Purchasers may be...
location where a bank
Bank
A bank is a financial institution that serves as a financial intermediary. The term "bank" may refer to one of several related types of entities:...
, credit union
Credit union
A credit union is a cooperative financial institution that is owned and controlled by its members and operated for the purpose of promoting thrift, providing credit at competitive rates, and providing other financial services to its members...
, or other financial institution
Financial institution
In financial economics, a financial institution is an institution that provides financial services for its clients or members. Probably the most important financial service provided by financial institutions is acting as financial intermediaries...
(and by extension, brokerage firms
Broker
A broker is a party that arranges transactions between a buyer and a seller, and gets a commission when the deal is executed. A broker who also acts as a seller or as a buyer becomes a principal party to the deal...
) offers a wide array of face-to-face
Real life
Real life is a term usually used to denote actual human life lived by real people in contrast with the lives of fictional or fantasy characters.-Usage online and in fiction:On the Internet, "real life" refers to life in the real world...
and automated services to its customers.
History and description
During the 3rd century banks in Persia (now Iran) and in other territories started to issue letters of credit known as Sakks, basically checksCheque
A cheque is a document/instrument See the negotiable cow—itself a fictional story—for discussions of cheques written on unusual surfaces. that orders a payment of money from a bank account...
in today’s language, that could be traded in cooperative houses or offices throughout the Persian territories. In the period from 1100-1300 banking started to expand across Europe and banks began opening ‘branches’ in remote, foreign locations to support international trade. In 1327, Avignon in France had 43 branches of Italian banking houses alone.
The practice of opening satellite branches was popularized in the early 20th century by Amadeo Giannini
Amadeo Giannini
Amadeo Pietro Giannini, also known as Amadeo Peter Giannini or A.P. Giannini , born in San Jose, California, was the American founder of Bank of America.-Biography:...
, then head of the Bank of America
Bank of America
Bank of America Corporation, an American multinational banking and financial services corporation, is the second largest bank holding company in the United States by assets, and the fourth largest bank in the U.S. by market capitalization. The bank is headquartered in Charlotte, North Carolina...
. Historically, branches were housed in imposing buildings, often in a neoclassical architecture
Neoclassical architecture
Neoclassical architecture was an architectural style produced by the neoclassical movement that began in the mid-18th century, manifested both in its details as a reaction against the Rococo style of naturalistic ornament, and in its architectural formulas as an outgrowth of some classicizing...
style. Today, branches may also take the form of smaller offices within a larger complex, such as a shopping mall
Shopping mall
A shopping mall, shopping centre, shopping arcade, shopping precinct or simply mall is one or more buildings forming a complex of shops representing merchandisers, with interconnecting walkways enabling visitors to easily walk from unit to unit, along with a parking area — a modern, indoor version...
.
Traditionally, the branch was the only channel of access to a financial institution's services. Services provided by a branch include cash withdrawals and deposits from a demand account
Demand account
A transactional account is a deposit account held at a bank or other financial institution, for the purpose of securely and quickly providing frequent access to funds on demand, through a variety of different channels....
with a bank teller
Bank teller
A teller is an employee of a bank who deals directly with most customers. In some places, this employee is known as a cashier. Most teller jobs require cash handling experience and a high school diploma. Most banks provide on the job training....
, financial advice through a specialist, safe deposit box
Safe deposit box
A safe deposit box or wrongly referred to as a safety deposit box is an individually-secured container, usually held within a larger safe or bank vault. Safe deposit boxes are generally located in banks, post offices or other institutions...
rentals, bureau de change
Bureau de Change
A bureau de change or currency exchange is a business whose customers exchange one currency for another. Although originally French, the term bureau de change is widely used throughout Europe, and European travellers can usually easily identify these facilities when in other European countries...
, insurance
Insurance
In law and economics, insurance is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for payment. An insurer is a company selling the...
sales (where it is allowed by law), etc. In the early 21st century, features such as automated teller machine
Automated teller machine
An automated teller machine or automatic teller machine, also known as a Cashpoint , cash machine or sometimes a hole in the wall in British English, is a computerised telecommunications device that provides the clients of a financial institution with access to financial transactions in a public...
s (ATM), telephone
Telephone banking
Telephone banking is a service provided by a financial institution, which allows its customers to perform transactions over the telephone.Most telephone banking services use an automated phone answering system with phone keypad response or voice recognition capability...
and online banking
Online banking
Online banking allows customers to conduct financial transactions on a secure website operated by their retail or virtual bank, credit union or building society.-Features:...
, allow customers to bank from remote locations and after business hours. This has caused financial institutions to reduce their branch business hours and to merge smaller branches into larger ones. Conversely, they converted some into mini-branches with only ATMs for cash withdrawal and depositing; computer terminals for online banking and cheque
Cheque
A cheque is a document/instrument See the negotiable cow—itself a fictional story—for discussions of cheques written on unusual surfaces. that orders a payment of money from a bank account...
depositing machines. Some mini-branches may have one or no human staff with only telephone support.
Some financial institutions, in an attempt to show a friendlier image, offer a boutique
Boutique
A boutique is a small shopping outlet, especially one that specializes in elite and fashionable items such as clothing and jewelry. The word is French for "shop", via Latin from Greek ἀποθήκη , "storehouse"....
or coffeehouse
Coffeehouse
A coffeehouse or coffee shop is an establishment which primarily serves prepared coffee or other hot beverages. It shares some of the characteristics of a bar, and some of the characteristics of a restaurant, but it is different from a cafeteria. As the name suggests, coffeehouses focus on...
-like environment in their branches, with sit-down counters, refreshments, interactive displays, music and playing areas for children. Some branches also have drive-through
Drive-through
A drive-through, or drive-thru, is a type of service provided by a business that allows customers to purchase products without leaving their cars. The format was first pioneered in the United States in the 1930s but has since spread to other countries. The first recorded use of a bank using a drive...
teller windows or ATM's. Other financial institutions reduce their costs and position their offerings by having no branches and are sometimes known as virtual bank
Virtual bank
A direct bank is a bank without any branch network. It offers its financial services by:* Telephone banking* Online banking* Automated teller machines * Mail banking* Mobile banking...
s.
Legal restrictions
Historically, branch banking in the United States - especially interstate branch banking - was viewed unfavorably by regulatory authorities, and this was codified with the enactment of the McFadden ActMcFadden Act
The McFadden Act is a United States federal law, named after Louis Thomas McFadden member of the United States House of Representatives and Chairman of the United States House Committee on Banking and Currency, enacted in 1927 from recommendations made by the comptroller of the currency Henry May...
of 1927, which specifically prohibited interstate banking. Over the next few decades, some banks attempted to circumvent McFadden's provisions by establishing bank holding companies that operated so-called independent banks in multiple states. To address this, The Bank Holding Company Act of 1956
Bank Holding Company Act of 1956
The Bank Holding Company Act of 1956 is a United States Act of Congress that regulates the actions of bank holding companies.The original law , specified that the Federal Reserve Board of Governors must approve the establishment of a bank holding company, and prohibited bank holding companies...
prohibited bank holding companies headquartered in one state from having branches in any other state.
Most interstate banking prohibitions were repealed by the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994. Some states have also had restrictive bank branch laws; for example, Illinois outlawed branches (other than the main office) until 1967, and did not allow an unlimited number until 1993.
Traditional or brick-and-mortar
These are typically stand alone branches of a financial institution that often are contained in its own building. These branches typically offer full service banking including safe deposit boxes. They may include access to a drive-through teller windows.In-store
These are typically branches located in a retail space such as a groceryGrocery store
A grocery store is a store that retails food. A grocer, the owner of a grocery store, stocks different kinds of foods from assorted places and cultures, and sells these "groceries" to customers. Large grocery stores that stock products other than food, such as clothing or household items, are...
or discount store
Discount store
A discount store is a type of department store, which sells products at prices lower than those asked by traditional retail outlets. Most discount department stores offer a wide assortment of goods; others specialize in such merchandise as jewelry, electronic equipment, or electrical appliances...
. They may be full service branches or limited service branches. They generally do not include a drive-through teller windows or safe deposit boxes. These branches have limited staff and typically include technology as a means to deliver banking services such as the use of automated teller machines, videoconferencing
Videoconferencing
Videoconferencing is the conduct of a videoconference by a set of telecommunication technologies which allow two or more locations to interact via two-way video and audio transmissions simultaneously...
, and video banking
Video banking
Video banking is a term used for performing banking transactions or professional banking consultations via a remote video connection. Video banking can be performed via purpose built banking transaction machines , or via a videoconference enabled bank branch.- Types of Video Banking :Today, video...
systems.
Green Branch
Green Branch
“Green Branch” is a federally registered trademark to denote sustainable construction and design of retail banking locations. This term was granted as a trademark by the U.S. Patent and Trademark Office on Oct. 23, 2007. to The PNC Financial Services Group, Inc....
is a federally registered trademark to denote the environmentally friendly construction and design of retail banking locations. This term was granted as a trademark by the U.S. Patent and Trademark Office on 16 January 2007 to the PNC Financial Services
PNC Financial Services
PNC Financial Services Group, Inc. is a U.S.-based financial services corporation, with assets of approximately $264.3 billion...
Group, Inc. (NYSE: PNC). The basis for the federal patent office’s approval of PNC’s trademark application included the determination that financial and banking services are not generally associated with environmentally friendly or ecologically efficient characteristics.
Occupations
- Bank manager, managementManagementManagement in all business and organizational activities is the act of getting people together to accomplish desired goals and objectives using available resources efficiently and effectively...
- Bank tellerBank tellerA teller is an employee of a bank who deals directly with most customers. In some places, this employee is known as a cashier. Most teller jobs require cash handling experience and a high school diploma. Most banks provide on the job training....
- Financial advisor
- Security guardSecurity guardA security guard is a person who is paid to protect property, assets, or people. Security guards are usually privately and formally employed personnel...