Commonwealth Banks commits to regional branches for three more years

The nation’s biggest lender earlier this year promised to halt regional branch closures while a Senate inquiry into the effects ran its course.

Commonwealth Bank has decided to leave hundreds of its regional branches open for at least three more years, in welcome news to regional Australia that come ahead of a senate inquiry resuming next month.

The country’s largest lender in February paused regional branch closures while the Rural and Regional Affairs and Transport References Committee examined how exits are impacting communities this year. 

“Today is a great day for the people of regional NSW,” said Junee Licorice and Chocolate Factory general manager Rhiannon Druce. “(It) is a great win for regional areas which I hope other banks follow.”

Ms Rhiannon had been one of many community businesses leaders protesting and writing to the bank late last year after hearing CBA’s last branch in Junee was due to close.

Commonwealth Bank has the county’s largest branch network, with about 39 per cent of its 807 branch and service centres located in regional Australia.

It closed 68 locations in the last financial year, according to its last annual report.

“The way people are banking is changing, with more customers adopting the benefits offered by digital and phone-based services,” retail banking services group executive Angus Sullivan said.

“Through this time of change we want to support customers in regional areas who prefer banking in branch and so we will maintain our existing face-to-face services in these communities.”

Australians are increasingly using remote methods to access banking services such as online and via smartphones, but digital adoption by the 28 per cent population in regional areas is lower.

But for some, the lack of a rural bank branch can mean having to travel hundreds of kilometres to see an account manager to obtain an approval for a mortgage, or opening an account.

“Even though more people are using remote banking methods it is still important for communities in regional areas to have easy access to bank branches when seeking mortgage approvals or depositing large sums of cash which many businesses still do,” Ms Rhiannon said.

And with the population of many regional towns growing, it “makes sense to keep banks open there,” she added.

CBA said the announcement was in line with its commitment to provide customers “with a wide range of flexible banking options and locations”.

“We look forward to working closely with regional communities over the next three years to refine how we better support and familiarise them with all the CBA banking services available,” Mr Sullivan said.

Hearings on the impact of bank closures on rural communities are set to resume next month in the towns of Carnamah and Beverly in Western Australia.

With official figures showing over 470 regional and rural banks closed between mid 2017 to early 2022, the inquiry committee asked lenders to pause closures until the end of the review in December.

CBA has repurposed 90 of its rural branches to offer local services in person in the mornings and early afternoons, before they are closed to be used as call centres.

Its smaller rival, Westpac Banking Group, in May said it would will keep open a handful of rural branches it had previously earmarked for closure.