Where Bank of America is axing branches

Bank of America has made clear that it intends to cut back on the number of bank branches it operates, which is understandable in this era of Project New BAC.

Bank of America no longer intends to be a full-service bank for all of America, if it ever really did. It prefers to stick to areas where the ROI is compelling.

So where will the bank cut back?

It would appear that more exits will take place in smaller metropolitan areas. The recent closings all fit that bill, and Bank of America also "has a number of branches in even smaller markets, including 28 branches with a total of $706.5 million in deposits in 19 (metropolitan areas) with less 30,000 people. The company could consider shedding those branches, particularly since its deposits have contracted in 12 of the 19 markets."Bank of America has already closed a net 51 branches in the first quarter and still plans to close 750 branches over the next few years. The bank recently "sold 15 branches in Maine and another five branches in Iowa in separate transactions. The deals were the first branch sales by the Charlotte, N.C.-based company in almost 11 years and likely will not be the last in the near term. Pruning rather than wholesale exits likely will be (the bank's) approach. The company laid out its plans to retreat from certain areas when submitting its capital plan to regulators last year, but the details of the plan were not made public."

SNL also suggests that the bank may consider paring back in lower-income areas, which is always fraught with political baggage. "The company has 377 branches with $17.81 billion in deposits in areas where the median income is below $40,000, well below the median national household income of roughly $52,000 a year."

The most vulnerable areas will likely be lower-income areas in which Bank of America is not a dominant bank.