Fifth Third Bancorp (FITB) Plans to Consolidate/Sell ~100 Branches

Fifth Third Bancorp (NASDAQ: FITB) announced plans to pursue changes to its branch network as it works to improve efficiency, competitiveness and the quality of its customers’ experience.

“Consumer demographics and our customers’ preferred channels of banking are undergoing significant changes,” said Kevin T. Kabat, vice chairman and chief executive officer of Fifth Third Bancorp. “Technology continues to impact our service delivery and revenue generation tactics and strategies. We have been very successful in growing our market share in our footprint as the most recent FDIC data clearly shows, and we will continue to maintain the same focus going forward by optimizing the size and density of our branch network.”

The Company is pursuing this plan as part of its regular review of customer preferences and usage patterns across its network and all distribution channels. Fifth Third currently expects to consolidate or sell approximately 100 branches and approximately 30 other properties purchased earlier for future branch expansion.

“This plan reflects the continued progression of our work on providing an integrated customer experience,” Kabat said. “Meeting the evolving preferences of how our customers interact with us is our top priority. Over the past several years, we have made significant improvements to our mobile banking options and our sales and staffing models, and plan to tailor our branch network in concert with these changes. We continue to believe an optimized branch network plays a significant role in meeting the financial needs of our customers, and in delivering an integrated customer experience.”

In connection with these plans, Fifth Third Bancorp expects to incur approximately $75-85 million in non-cash impairment charges to be recognized in the second quarter of 2015. Fifth Third also expects to recognize approximately $6 - 10 million in other costs, primarily related to real estate contract terminations. The Bancorp believes that these actions will result in annualized reduction of approximately $60 million in ongoing operating expenses and are expected to be fully executed by mid-2016.

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