Charlotte bound: U.S. Bank expanding into hometown of BofA, BB&T-SunTrust

U.S. Bancorp plans to open its first branch in Charlotte, N.C., this fall as part of a bigger expansion there — the latest effort by large banks to plant flags in the biggest cities.

It is an especially high-profile move for the Minneapolis company because Charlotte is the hometown of Bank of America and would be the headquarters of BB&T and SunTrust Banks provided regulators approve their merger deal.

U.S. Bancorp, which does business under the U.S. Bank brand, will open a branch on South Tryon Street in the Uptown neighborhood, across the street from a branch of the $35 billion-asset First Citizens Bank & Trust, another North Carolina bank. U.S. Bancorp will open about 10 branches in Charlotte by the end of 2020, a company spokeswoman said Monday.

“We already have tens of thousands of customers in the Charlotte market, and we look forward to deepening those connections, as well as building a future generation of customers,” Tim Welsh, vice chairman and consumer and business banking, said in a news release. Those existing relationships are in mortgages, auto loans and credit cards, the company said.

The decision is part of a broader trend. JPMorgan Chase, BofA and other rivals are opening branches in cities outside their traditional territories to market digital offerings to customers who may already have a credit card or car loan with the bank.

BofA, for example, is opening hundreds of branches in new markets like Cincinnati, Indianapolis and Pittsburgh. JPMorgan Chase plans to open up to 90 branches this year alone in Charlotte, Nashville, Tenn., St. Louis and other new markets.

U.S. Bancorp is doing the same thing, and Charlotte is its first stop. In September, CEO Andy Cecere said the bank was eyeing expansion into Southeastern cities where it has no retail presence, including in North Carolina, Texas, Georgia and Florida. The company has retail branches in 26 states, including Tennessee, Kentucky and Arkansas in the South.

At the same time, large banks are paring back underperforming segments of their branch networks. U.S. Bancorp said last week that it will reduce its branch network by 10% to 15% over the next few years and cut hundreds of jobs.

The new U.S. Bank branch will be located near the company’s existing corporate office, which is staffed by about 800 employees in investment services, risk and compliance management, mortgages, and corporate and commercial banking.

U.S. Bancorp decided to enter Charlotte now because it completed the overhaul of its mobile app in March, and it plans to use the branches as a platform for marketing, Welsh said in a follow-up interview.

The company will be “proceeding thoughtfully” on where to expand next, Welsh said. It will select new cities for expansion based on their growth characteristics; if it already has a large base of credit card, mortgage or auto loan customers there; and if the bank already has back-office employees located there.