As e-commerce continues to disrupt retail banking, Umpqua Bank is unveiling a new digital strategy that will result in fewer brick and mortar branch offices and more emphasis on electronic transactions and enhanced personal service through mobile bankers.
Umpqua plans to close three of its 10 Clark County branch stores by March. Stores closing are in downtown Ridgefield, at Stockford Village (north Vancouver) and in downtown Vancouver at Esther Short Park. Customers of these branch operations have been notified by mail and are being directed to remaining branches.
The closures are among 30 planned company-wide in the next three to six months as part of a downsizing and shift to online and digital banking. Twenty-six branches were closed in 2016.
Umpqua cited a recent industry study indicating that 46 percent of consumers now interact with their bank entirely through digital channels. This represents a 30 percent increase from 2012, stated an Umpqua press release outlining the bank’s new “human-digital” banking strategy.
“Money is at the center of people’s lives, and we believe Umpqua has a unique opportunity to create a different approach to banking that combines people and technology to build deeper, more meaningful relationships with our customers,” Umpqua President and CEO Cort O’Haver said.
Just as online shopping is transforming the retail industry, smartphones, iPads and other electronic devices make it easy for consumers and business clients to make deposits, charge accounts and transfer money without ever entering a branch.
Umpqua officials said the bank is launching its digital transformation after completing a successful six-month pilot program involving 1,800 customers. The pilot tested whether customers would adopt and find value in a digitally based relationship model supported by a “personal private banker.” More than 90 percent of participating customers did, “finding that the human-digital approach enhances the banking experience,” according to the news release from Umpqua.
The bank expects to start using in-store text, chat and video technology in select stores to provide consultative banking services. A cadre of mobile bankers will serve customers who are without a store by using digital technology and in-person consultations. The new market strategy will gradually roll out through the Umpqua network.
Portland-based Umpqua Holdings Corp., parent company to Umpqua Bank, operates in five Western states, including Oregon, Washington, Idaho, Nevada and California. In its most recent third quarter ending Oct. 18, Umpqua reported earnings of $61.3 million compared to$61.8 million in third quarter 2016. The bank saw annualized deposit growth of 8 percent with total consolidated assets of $25.7 billion compared with $24.7 billion in 2016.
In September, the bank announced a 12.5 percent increase in its quarterly dividend to 18 cents a share. Umpqua Holdings trades on the NASDAQ stock exchange with the symbol UMPQ. In the past 52 weeks, Umpqua’s share price has increased 39 percent from a low of $14.77 to around $20.
Umpqua Bank stores slated for closure in 2018:
Location Address Closure Date
Ridgefield 228 Simons St., downtown March
Vancouver 720 Esther St. Feb. 24.
Vancouver 600 NE 99th St. Feb. 21.