Affluent Branch Strategy with Tony DeSanctis

Hey, GonzoBankers. Tony DeSanctis back with another hot take.

This one is about JPMorgan’s new affluent branch strategy.

So JPMorgan Chase has done a lot in the branching space and has decided, based on some history they have with their acquisition of First Republic, that they’re going to invest in what is really a niche more than it is a branch strategy. But I want to talk about the branch component.

So this is going to be targeted at not mass affluent and not private client, but the affluent population. The target is between $2 million and $3 million in investable assets, essentially a space that they haven’t had a ton of success with despite banking a lot of those customers.

The part that is interesting here is they’re going to pivot and create a differentiated branch experience, starting with about 31 branches here over the next year or so.

And I’m just going to read this quote from the CNBC article to kind of paint the picture for you.

Gone is the traditional row of bank tellers. There’s instead a concierge desk, a solitary ATM. Instead of lollipops, visitors are offered squares of Dylan’s chocolate. The space is quiet except for the crack of Perriers being opened or the whir of an espresso machine.

Okay, here’s my question.

If you have $2 million to $3 million in investable assets, are you going into a bank branch? Do you expect to have to go into a bank branch to have your problem solved?

I’m much more interested in their separate and unique digital strategy for this. They’re going to have a different app, and I’m very skeptical that a branch strategy is going to sustain.

If you think about the investable assets, which is what they’re after, how big is Fidelity’s branch footprint? How big is Vanguard’s branch footprint?

I think this could have some viability, but I do think that this is maybe a little bit backwards.

I’d be much more interested in a concierge experience where I had a banker coming to my house if I have this much in investable assets, having conversations with me on a regular basis.

So I’m a little bit reticent to sign off on yet another differentiated branch experience when the ideal branch experience is no branch experience.

So I’m maybe being a little too Gonzo here and inheriting some of Ron Shevlin’s snark. But what do you think? Tell me in the comments, is a differentiated branch experience for affluent customers something that you think is worthwhile?