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Imagine an urban bank where a customer takes an elevator to the fourth floor to enter the branch, takes a number, and sits down on a couch to wait. And wait. Eventually a teller approaches and takes the transaction paperwork, then disappears behind a low counter into an area that resembles a government office. Five, 10 or 15 minutes later, the banker emerges, transaction complete, and hands the receipt or cash to the customer with a bow. By this time 20 or more minutes may have passed and new product sales weren't even on the table.
August 1 -
Citi's top consumer banking executive said Wednesday that the company, which has long considered its reach in more than 100 countries to be its primary competitive advantage, has drilled down further to identify 150 major metropolitan areas as priority markets for its retail banking and cards businesses.
November 17
Citigroup Inc. Chief Executive Vikram Pandit made time on Thursday for a ribbon-cutting ceremony at a new Citibank in Manhattan's Union Square. That tells you something about the importance his company has assigned to the new location.
But the real significance of the 9,600-square-foot branch is not the collection of bells and whistles that Citi calls its "smart banking technologies." Many of the features, if not already offered by competitors — the Bank of America Corp. branch up the block also has a comfortable lounge and check-scanning ATMs that do not require deposit envelopes — are unlikely to leave much of an impression on customers who regularly encounter these things elsewhere in their lives. Free Wi-Fi? Got it at Starbucks. Flat-panel touch screens? Practically de rigueur for anyone with an iPhone.
The most interesting thing about the new Citi outlet is what it says about the state of branch banking. All the major trends have come together under one roof on this heavily trafficked corner of 14th Street and Broadway: more technology, longer hours, fewer people wearing multiple hats. And all the newest design elements are borrowed from the places where real innovation is happening, like Apple retail stores.
Pandit, after describing the "smart" technologies that had been imported from Citi test branches in Asia, wasn't just flattering the rank and file in attendance when he said, "Ultimately, what makes for a smart bank is smart bankers." Even as banks make incremental improvements to the branch experience, the defining factor, as usual, comes down to service.
"I tell people all the time, ‘Give me a gray, cinder block building and great people, and I'm going to beat your flat screens any day,'" said Dave Martin, an executive vice president at NCBS, a SunTrust Banks Inc. subsidiary that sells training, design and construction services to retail banks.
To that end, while the new Citi branch is partly staffed with outside hires, it also employs several Citi veterans. Branch manager Billy Cho has been with the company for a decade, most recently running a branch in the residential Upper West Side. In Union Square, he now oversees a branch in the heart of an area through which 200,000 residents, office workers and tourists pass every day.
The branch is open seven days a week, from 8:30 a.m. to 7 p.m. Monday through Friday, from 9 a.m. to 5 p.m. on Saturday and from 11 a.m. to 4 p.m. on Sunday. That's close to 25% more weekly hours than the average branch, with a staff that, while larger than the six-person suburban branch Cho managed earlier in his career, is less than two-thirds the size of some of Citi's big branches in midtown Manhattan.
As a result, most of the branch's 24 employees take on multiple roles throughout the business day depending on customer need. When the teller line is slow, someone staffed behind the teller counter might meet with clients in one of the personal banking offices, or greet customers at the door, or station himself or herself at the concierge-style desk up front. That desk, by the way, is a point of differentiation for the branch. Many bank branches have welcome desks positioned near the door, but at this one customers can conduct a range of transactions, from ordering personal checks to obtaining a bank check to bring to a real estate closing — though transactions involving cash still require a trip to the teller window.
But in this case, teller window is the wrong phrase. There is no glass separating the tellers from customers. The staff has been moved in front of the glass wall, stationed at desks reminiscent of the set-up at the "genius bar" where customers go for advice and repairs at Apple's retail stores. This is no coincidence. The environmental design and technology interfaces in the branches were designed by Eight Inc., the designer of Apple's retail outlets. But coincidentally, it is technology like Apple's that makes investing in branches such a gamble right now.
As mobile banking gets bigger and customers find fewer reasons to talk to a banker in person, how much longer will branches be needed? Manuel Medina-Mora, head of Citi's consumer banking in the Americas, was feeling sanguine about this as he showed off a giant touch screen where customers can access information about Citi products grouped by life stage, i.e. starting your financial life, managing your money, saving for tomorrow or financing a home.
"Owning a home, for example, is such an important decision in your life. You probably would not like to do that [via] mobile," Medina-Mora said.
