A man walks past a Wells Fargo Bank branch on a rainy morning in Washington, DC.
Gary Cameron | Reuters
US banks closed a record number of retail branches in 2021 as customers increasingly turn to digital banking and the industry consolidates.
US banks closed 2,927 net branches last year, according to data from S&P Global Market Intelligence. Banks closed nearly 4,000 branches and opened more than 1,000 branches, according to the analysis.
Another record year for bank closures comes after 2020 hit a previous peak as the Covid pandemic accelerated digital adoption.
"We expect the downward trend in branches to continue for a number of years … as more of the transactional aspects of banking go digital," Gerard Cassidy, head of U.S. bank equity strategy at RBC Capital Markets, told CNBC.
Branch closures also come as banks consolidate, with mergers and acquisitions in the industry topping $77 billion in 2021, according to S&P Global, the highest level since 2006.
"As consolidation continues and there are overlapping locations when deals are approved, there is no need to have two locations on Main Street," Cassidy said.
According to S&P Global Market Intelligence, Wells Fargo was the top store closer in 2021, closing 267 net retail locations last year.
While JPMorgan Chase was the sixth-largest net store closer last year, the company opened the most stores as it expanded into new markets in 2021, with 169 new locations.