Closed bank building, but with a twist: can it thrive with robo-tellers?

I promise—cross my heart and hope to die—that I didn’t plan this blog article in light of recent events.  A single closed bank branch is hardly cause for alarm, especially compared to what’s been happening to the entire operations of some fairly large banks these last few weeks.  And we may still be fully in the midst of a contagion—a financial panic vaguely paralleling the moral panic that has afflicted a good part of the world these last few years.  It was late February after all, when I made an impromptu visit to Orange, Virginia—a town of 5,000 just out of reach of the vast Washington DC metropolis, and a town best known as the closest municipality to James Madison’s venerated estate Montpelier.  The county seat of sparsely populated Orange County, Orange itself is a tidy, handsome enough town—not striking but certainly not blighted in appearance.   It’s probably a 75-minute drive to the thick suburban stew that is Northern Virginia (NoVa), DC’s expansive and overwhelmingly affluent suburbs.  Orange has doubled in population since 1990, attracting those seeking a comfy, rural atmosphere that’s still a quick jaunt to the nation’s capital.  Such population growth usually portends well for a municipality’s old downtown, and Orange is no exception: it’s three-block main street may not have been teeming with activity on a federal holiday (Presidents Day), but the buildings are well kept.

A doubling in population, however, didn’t stop the second largest bank in the country from closing its branch in the town.

It’s an old bank building, the likes of which one can easily find in a town over a certain minimum size (and that minimum doesn’t usually have to reach the quadruple digits).  Even though I failed to take a photo that reveals its complete façade, there’s no mistaking those Ionic columns, or that ornamental pediment above the lintel—even though the columns and tympanum shield brickwork instead of the more conventional limestone.  Knowledge of those wonky architectural terms is unnecessary.  It’s clearly a bank, it has always been a bank, and the next use most likely will be a bank.

But it’s vacant.  What happened to Bank of America?  Why did it close its location in a town whose fiscal fortunes seem to be improving?  From what I can tell, at least through a casual survey of Orange’s recent photographic history courtesy of Google Street View, the building still hosted a Bank of America in 2018, just as it had in in 2009, the earliest year of Street View photos.  But it closed in the last five years or so.  Here’s the side of the building:

Same sign in the drive-thru window as it had at the doorway on West Main Street.  Somewhat surprisingly, though, the branch left the signature logo and lettering mounted on the side of the canopy.  That’s usually one of the first things to go, since logos affixed to a building are a reliable signal to passers-by that the business within is still in operation.  Not the case here in Orange.

The adjacent parking lot (from which I took the previous photo) likely reveals what’s going on.

The operators of this closed Bank of America branch blotted out the first of the three labels on that wooden sign—the one that “Customer Parking”—but they retained the lettering for the other two features.  “Drive-up Banking” sure seems to be closed, but perhaps they meant something else?

There it is: the drive-up banking in 2023 constitutes an ATM machine for which users don’t have to leave their car.  The interior of the old bank building might be empty, but so many of the core features of the bank can still transpire, thanks to that ATM box.

I haven’t been able to determine exactly why this particular bank branch closed, but it’s no secret that COVID-19 restrictions upended the nation’s work force, and, to some extent (it seems) its work ethic.  It would take far more research than I care to invest, to learn if a unique explanation exists for why banks specifically have struggled to find personnel.  Regardless, among the workers whose employers encouraged telework during the pandemic, many did not feel impelled to return as COVID’s threat waned.  As this article indicates, major banks like Wells Fargo and Bank of America faced labor shortages in late 2021, prompting them to temporarily close many branches; some ended up getting shuttered permanently.  The condition in Orange seems to suggest this might be the explanation: the closed bank has retained its sign on the exterior and still operates the ATM in the parking lot, indicating that it still either owns or leases the property.  And, with two operating BoA branches in neighboring towns about ten miles away (Culpeper and Ruckersville), locals from Orange don’t have too far to travel if they need banking services other than that ATM.  In an era of online banking, where major banks offer all of their rudimentary services through a computer or smart phone, why endure the expense of 10 to 15 paid staff?  Bank of America can generate enough activity through a low-maintenance machine in its parking lot, at least until the property owner finds a new (presumably fiduciary) tenant for that venerable old building, at which point BoA will likely relinquish the ATM and the lot.

This isn’t the only closed bank on Orange’s main street from the last few years.

From what I can tell, this building hosted a Virginia National Bank as recently as 2018; the parent company probably vacated it during COVID, again due to staffing shortages.  Though nowhere near the size of Bank of America—Virginia National is a regional chain spread across just a few counties—it seems to have folded the Orange location as well.  But unlike Bank of America, the Virginia National seems to have pulled out of the structure completely.  Aside from size, what’s the big distinction between these two closed banks?  As Street View indicates, the Virginia National Bank lacks that one critical amenity: an easy-access drive-thru ATM.  Thus, if the primary debacle facing the bank branch was an inability to find staff amidst COVID, the management experienced no benefit from mothballing the building while keeping while giving its customers a basic transactional portal through the ATM—because, as far as I can see, the structure has no external ATM.  The end result?  Another closed bank.

Two old, sturdy beautiful bank buildings in a small town’s main street, both of them fundamentally empty.  Sure, it’s a byproduct of the extreme staffing circumstances during the peak of the pandemic—a condition that quashed the small-business vibrance of numerous main streets similar in size to Orange.  But the closed bank owes an equal amount to computerization and automation—a condition that reduced the need for tellers a few decades ago, since the computer interface of an ATM could handle the most common and rudimentary transactions.  And the capacity for computers grew as online banking and direct deposit/debit expanded the portions to a greater complexity of services.  By 2010, basically no one needed to go to banks to cash checks.  The staff at bricks-and-mortar locations increasingly handled more complex endeavors like financing, elevating the necessary minimum qualifications of personnel—and making them more expensive.  And the need for bricks-and-mortar banks continued to decline, especially those in quasi-urban settings, where old thick buildings are costly to heat and cool, parking is often scarce and inconvenient, and the aging structures are not necessarily as amenable to modern-day security and surveillance.

It wouldn’t surprise me in the least if the closed bank scenario I discovered in Orange is growing phenomenon: the bank holds on to the property and derives value from it through the on-site ATM, while waiting for a new tenant (probably another bank) to make a better offer.  But it offers a considerable number of banking services with a staff of zero.  It reminds me an equivalent enterprise I wrote about a few months ago: a completely unmanned gas station in Utah.  Sure, it didn’t do everything one might expect at a gas station: no convenience store, no air for the tires, no lottery tickets.  But customers can purchase gas and will never engage a clerk.  Meanwhile, in Orange, it’s 75% of a bank, but no teller.  Two commonplace industries with no human engagement.  It’s a great future for misanthropes!