Bank of America (NYSE: BAC) Closing Branches in Massachusetts

Bank of America (NYSE: BAC), the Charlotte based banking giant, continues its reorganization plan to cut costs heading into 2013. Part of that plan is the closure of branches, in an effort to consolidate and raise profits in their core markets. The most recent news comes out of Massachusetts, where Bank of America is the largest bank in the state, and has plans to close multiple branches due to sagging profits and rising costs.

The plans will shutter four more branches in the state in March, including one near Boston City Hall, the latest in a string of closings. The bank plans to close offices at 3 Center Plaza in Boston, One Chace Road (Crossroads Common) in Freetown, 181 Court St. in Plymouth, and 3065 North Main St. in Springfield. In addition, the bank plans to eliminate the drive-up window at its branch on Main Street in Westfield. The bank has already closed dozens of branches in Massachusetts in the last few years.

The bank has been hit hard by the weak economy – low interest rates are good for consumers, but terrible for banks operating as a spread business. The increase in regulation is also taking its toll on financial service firms, causing the firms to reconsider every element of their business model. In the increasing digital world, fewer customers are visiting traditional branches because they are doing more banking online or at automatic teller machines.

To become more efficient and cut costs, the bank has said it plans to close 750 of its roughly 5,700 US branches and eliminate at least 30,000 jobs over the next few years. “As we’ve acknowledged on numerous occasions, the number of branches in our nationwide network will trend down over the next few years,” said spokesman T.J. Crawford. “That being said, we still have a significant brick-and-mortar presence in Massachusetts.”

Citibank recently announced plans to shut 84 branches around the world, including nearly one-third of its 31 retail locations in Greater Boston. Overall, US banks are closing branches faster than they are opening new ones, according­ to the Federal Deposit Insurance Corp., the agency that insures deposits. Bank of America had 264 offices in Massachusetts as of June, down from more than 300 in 2009, according to data collected from the FDIC.

Despite the pending closings, Bank of America will have more branches than any other bank in Massachusetts, but the advantage is shrinking. Citizens Bank had just 10 fewer offices than Bank of America in June, down from a gap of more than 50 offices in 2009, though many of Citizens’ branches are smaller offices that are located in supermarkets.