BATAVIA — The Five Star Bank branch at 567 East Main St. will close permanently as part of a move to better align Five Star’s operations with changing customer preferences.
The bank cited increased consumer options such as online banking — which has become increasingly popular — as part of its decision. Batavia East’s operations will be consolidated with its second branch at 401 West Main St. in the city.
The branch is among six set to close. The others are located in Olean in Cattaraugus County; Bath and Avoca in Steuben County; Elmira Heights in Chemung County; and Geneva in Ontario County.
“While our values and service promises remain steadfast, we have a fundamental responsibility to our customers, associates and the communities we serve to adapt our approach as market conditions change,” said CEO Martin K. Birmingham in a news release. “Over the years we’ve launched technology and developed unique partnerships that offer customers a more seamless, integrated experience, regardless of how they choose to bank with us. Now, as the reliance on, and customer demand for, digital banking services rise, our branch offices must evolve once again.”
The closings will eliminate overlapping branches and consolidate its full-service locations to where there’s more traffic, such as near shopping centers and gas stations, Five Star officials said.
The cuts will also reduce the bank’s workforce by 6%. The employees affected were given the chance to apply for other positions within the banking company, and comprehensive severance packages were otherwise issued based on tenure.
The closure decision followed a nine-month examination of all of Five Star’s lines of business and operations. Total daily in-branch teller transactions have been declining by 6% annually since 2018, and similarly in the first three months of 2020, prior to the COVID-19 pandemic.
The Batavia East Branch had closed in March for the pandemic and hasn’t reopened since.
“We care deeply about our associates and determinations were made after months of careful consideration and thoughtful analysis of branch utilization and financial impacts,” Birmingham said. “This was a very difficult decision to make but it was done with equity and dignity at the forefront. It’s never easy to say goodbye to colleagues, but to successfully serve our clients now and long into the future, embracing change was necessary.”
Five Star plans to continue building market share by adding two new branches next year in Buffalo and continuing to expand its services.
Five Star Bank is a subsidiary of Financial Institutions Inc. which is headquartered in Warsaw. The bank has more than 50 locations.