17 September 2007

CIBC to Test Sunday Branch Hours

The Globe and Mail, Tara Perkins, 17 September 2007

Any notion that bank machines and the Internet will replace the teller and local bank branch were put further to rest Monday with Canadian Imperial Bank of Commerce's announcement that it is going to test Sunday branch hours in select locations.

The big banks are falling back in love with their expensive branch networks as the battle for customers heats up.

While some major banks once offered Sunday hours, they have been phased out and none currently has standalone branches open Sundays.

Some banks have smaller pavilions in grocery stores or malls that are open seven days a week.

CIBC's decision to start opening some of its Toronto- and Vancouver-area locations on Sundays, beginning later this year, comes as Toronto-Dominion Bank is aggressively recruiting staff in preparation for Nov. 1. That's the day TD rolls out its new extended hours.

The change will bring the number of hours the average TD branch is open each week to more than 60 from about 50.

And a Royal Bank of Canada spokeswoman said Monday that all of its main market branches are moving, or have moved, to extended hours.

Rivals who are jumping into the fray with banking products that are only available online, by phone or through independent advisers are part of the reason that the big banks are now trying to make the most of their physical locations.

TD's head of personal banking, Tim Hockey, said "competition continues to increase. It's a good thing for Canadian consumers, they get to reap the benefit of it."

"Those of us that have branch networks realize it's a great strength and tend to want to optimize that, and really make it stand out relative to those that don't," he added.

TD, which has the longest hours of operation of the big bank networks, doesn't currently have any plans for Sunday hours. But it's keeping an eye on CIBC's experiment.

"We know that customers like hours and if it turns out the customers really respond to Sunday hours, then we'll give them Sunday hours," Mr. Hockey said.

While it may seem counterintuitive that the banks are putting more money into their branch hours as Internet banking evolves, Mr. Hockey suggested online banking isn't quite as prevalent as some people might think.

TD has the highest proportion of customers who are actively banking online, but it's still less than one-third, he said.

Stephen Forbes, CIBC's senior vice-president of communications, said "branch banking is foundational to the service we provide. Many of our clients, particularly new Canadians, prefer to visit a branch, and by providing our clients with the ability to bank on Sunday, we are providing more flexibility and choice."

And branches are still the best place for customers to get advice-based products, and to multitask, CIBC said.

"Whether our clients want to sit down and talk about a mortgage, set up an account for their child or get a mortgage or line of credit, the branch is generally the best place for our clients to do multiple things at the same time," said Christina Kramer, senior vice-president of CIBC retail markets.

CIBC will gauge the success of the new Sunday hours in its test markets before deciding whether to bring them to other locations.