German American Bancorp in Jasper, Ind., plans to close seven branches as more customers flock to digital channels.
The $5 billion-asset company said in a regulatory filing Friday that it will also “implement various staff reductions” in 2021. The closures and layoffs will take place over the rest of this year.
“The bank considered, among other factors, the operating costs of the branches, certain physical limitations impacting the bank facilities and their proximity to other bank branches,” the filing said.
The evaluation “also took into consideration the numbers and types of transactions being conducted by its customers and the increased usage of online and mobile banking,” the company added.
German American said it will record $3 million in pretax charges this year, including $1.8 million in the first quarter, tied to valuation adjustments on branch facilities, lease termination costs and severance.
The company said the moves will save it about $3.7 million a year, beginning in the third quarter.
