Residents Fear Bank Boom Is Leaving D.C. None the Richer
Monday, October 15, 2007
The residents were sorry when the duplex movie theater closed, but they saw a silver lining. Maybe a new cafe would open, or a Vietnamese restaurant, or even a bookstore.
So what's coming to Tenleytown in Northwest Washington and angering neighbors?
Not a liquor store or a nightclub, the usual sources of any community's agita, but a veritable pillar of the economy, one that is commandeering storefronts across the city: a bank branch.
Not unlike the seven branches already open within a half-mile of the Outer Circle theater's former site on Wisconsin Avenue.
"It contributes nothing to the community," resident Jonathan Bender said, grousing about Commerce Bank's plan to open where he once watched foreign films. "We already have tons of banks. It replaces one of our last vestiges of funkiness."
District officials initiated a campaign this year to lure A-list retail to Washington, places that would keep residents from trekking to the suburbs to splurge. But their vision of a shopper's paradise is running headlong into a reality that has emerged at cosmopolitan corners across the country: a proliferation of bank branches.
Since 2002, as banks have waged fierce competition for customers, the number of branches in the District has jumped nearly 20 percent, from 193 to 230, according to federal data. Nationally, the number of branches climbed 13 percent.
Most District branches have opened downtown and in well-to-do neighborhoods, occupying prime storefronts.
On K Street NW, 22 branches operate between 11th and 21st streets, including 10 that have opened since 2001. SunTrust and Chevy Chase Bank are among the branches dominating most corners of Farragut Square. And on Connecticut Avenue NW, 13 banks have offices along and adjoining the six-block stretch between Dupont Circle and K Street.
The branch boom has prompted District officials to mull ways to control the growth, a strategy at work in Chicago, where branches have increased by 50 percent since 2002, and New York, where Manhattan has experienced a 41 percent rise.
"It's not just the number of banks. The bigger issue is the prominence of their location," said Harriet Tregoning, director of the District's Office of Planning. "Some amount is a good thing, but an enormous amount is too much of a good thing."
In the 1990s, a period of mergers in the financial industry, many banks promoted online services and closed branches. But industry studies showed that customers wanted personal contact when managing their money, and banks began opening more branches in a surge fueled by new players such as Commerce, which models itself as a retail store.