Rural Communities and Several Major Urban Areas Bear Brunt of Bank Branch Closures Since Financial Crisis With Emergence of 86 New ‘Banking Deserts,’ NCRC Report Says

Maryland, Nevada, Georgia experience largest state-level declines in bank branches, NCRC report says. Biggest county-level declines in Baltimore County, Md.; Marion County, Ind.; Philadelphia, Pa. Click here to visit the web tool.

Washington, DC – Due to the closure of more than 6,000 bank branches nationwide since the financial crisis, rural communities around the country are experiencing a troubling decline in access to basic financial services, according to a report released today by the National Community Reinvestment Coalition (NCRC), “Bank Branch Closures from 2008-2016: Unequal Impact in America’s Heartland.”

Some key findings from the NCRC’s report on the decade-long surge in American communities without access to basic financial services, otherwise known as bank deserts, include:

  • 86 new banking deserts appeared in rural areas in the U.S. between the 2008 financial crisis and 2016.
  • 6,008 bank branches closed down nationwide between 2008 and 2016.
  • Although several metro areas saw 15-25% of their bank branches close down, rural and small town businesses suffered even greater long-term impacts from closures due to an already-low supply of banking services. These rural communities often have only one or two bank branches; one closure can leave residents and businesses vulnerable to predatory practices like payday lending.
  • 25% of all rural bank closures were in majority-minority census tracts, with Hispanic and Native American communities particularly vulnerable.
  • Baltimore, Chicago, Las Vegas, Philadelphia, and Houston rounded out the top five American metro areas with the most bank branch losses.
  • Maryland, Nevada, Georgia, Michigan and Pennsylvania experienced the largest state-level declines.
  • Baltimore County, Md. lost the largest proportion of its branches, with a 25.2% loss of locations, followed by Marion County, Ind. (21.1%); Philadelphia, Pa. (18.7%); Montgomery County, Pa. (18.2%) and Clark County, Nev. (17.4%).

“The rise of banking deserts in America does not bode well for our national economy,” said NCRC’s President and CEO John Taylor. “Cities and towns and rural communities weaken as branches close. A mobile phone is no substitute for a full-service bank branch. You may be able to deposit a check with a phone, but try developing an ongoing relationship with that internet branch in order to procure a small business loan or a mortgage or even different types of consumer credit.

“Bank branches are there to manage a community’s wealth as well as to reward shareholders of the bank. Yet those branches are often closed in order to create more profitability for the bank, even when those branches are viable, without consideration of what happens to people and businesses in those communities.

“Additionally, the bank branch is usually the economic anchor tenant in those communities, and when they leave, other businesses leave with them. Communities get poorer and this stresses local and regional economies and social support systems.

“Economic opportunity is made possible first and foremost by banks. Branches are the tip of the spear for that activity. Take away the branch and you are shutting down economic opportunity for those very people and businesses which made the branch viable in the first place.”

The report can be read here. Data from the report can be navigated using NCRC’s new online app.


About NCRC:
NCRC and its grassroots member organizations create opportunities for people to build wealth. We work with community leaders, policymakers and financial institutions to champion fairness in banking, housing and business development.

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