Don't like banks closing NJ branches? First Commerce Bank flips that script
JACKSON - In a departure from the banking industry's rapid consolidation, First Commerce Bank has opened a new branch on Brewers Bridge Road here, hoping to capitalize on Ocean County's huge population growth.
The branch will feature "universal bankers" instead of tellers, who can help customers both make transactions and open accounts. But its goal is old-school: win over customers through personal relationships, said Donald Mindiak, president and chief executive officer.
"We're a community bank," Mindiak said. "We're never going to compete with the likes of JPMorgan Chase or Bank of America. Because of that, we believe building relationships is just the hallmark of community banking."
The new location marks the 11th branch for First Commerce, a Lakewood-based bank that specializes in commercial real estate and business loans. The company's assets of $1.4 billion are up more than 10% since the beginning of the year.
The expansion marks a rarity. Banks during the past 15 years have watched foot traffic in their stores dwindle as new generations of consumers have turned to digital banking, prompting widespread closures. As of June 2022, Ocean County had lost about 30% of its bank branches over the previous decade, according to the Federal Deposit Insurance Corp.
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Still, banks continue to find demand for in-person visits to open accounts, resolve complicated issues and provide financial advice, said Stewart Watterson, a strategic adviser with Aite-Novarica Group, a consulting firm.
"A common response is that branches won't be needed, as the younger generations are digital natives and would scoff at a branch," Watterson said. "The data does not bear that out."
First Commerce's new branch in a strip center here was previously used by Santander Bank. It includes long-time banking features like drive-thru windows, safety deposit boxes and a coin counter. But the old-fashioned teller windows have given ways to pods, where universal bankers can put cash deposits through a machine that can separate bills by denomination.
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The chance to stop in and chat with a banker was appealing to Alan Hott, 80, of Jackson. A retired Wall Street banker, Hott said he has little trouble navigating online banking. But he recently opened an account at the new First Commerce bank, noting he liked the chance to talk to someone face-to-face.
"I think it's still critical, quite frankly," Hott said of physical bank branches. "I mean, online banking is easy, but sometimes you need someone who is not a faceless entity on the other end of customer service to talk to."
The trend in online banking gathered momentum during the pandemic, when consumers found they could skip visits to the branch and conduct their transactions through a network of ATMs, computers and smartphones instead.
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It isn't unusual for banks to consolidate and close branches. But they traditionally would be followed by the formation of new banks that would fill in the gap. This time, though, new banks have been slow to emerge in part because of tougher requirements from regulators in the aftermath of the Great Recession, analysts have said.
The result: New Jersey had a net loss of 279 bank branches during the past three years, or 10% of its total, a report by the Federal Reserve Bank of Philadelphia in March found, increasing the risk that customers won't have access to basic banking services.
The trend has been keenly felt in Ocean County, where elected officials worry its large senior population isn't as comfortable with technology as Millennials and Generation Z. Ocean County Commissioner Joseph Vicari, for example, has urged regulators to make it more difficult for banks to close branches.
"You need to feel safety and security going to a bank," Vicari said.
First Commerce started in 2006 as Northern State Bank, and was recapitalized and renamed four years later. The bank since then has made its mark, namely in Lakewood, where it has helped finance a building spree spurred by the fast-growing Orthodox Jewish population.
That growth has brought an increase in traffic that, Mindiak said, made it tougher for customers to get to First Commerce's Lakewood branch. The bank decided to open another location in Jackson, five miles away.
The bank could use the design model it rolled out in Jackson in other locations. The company wants to continue to expand, either on its own or through a merger, Mindiak said.
"There are always going to be traditionalists who like to come into the office and do a transaction face to face," he said. "We have to service all kinds, and that's our goal."
Michael L. Diamond is a business reporter who has been writing about the New Jersey economy and health care industry for more than 20 years. He can be reached at mdiamond@gannettnj.com.
This article originally appeared on Asbury Park Press: Lakewood-based First Commerce Bank expands with Jackson NJ location
