BRANCH BANK CLOSURES IN SYDNEY: A GEOGRAPHICAL PERSPECTIVE AND ANALYSIS

Abstract

The closure of branch banks is a significant component of the cost reduction and profit maximisation strategies currently being pursued by financial institutions in Australia as elsewhere. Although measures of financial performance are typically considered the most important in evaluating the viability of branches, there is evidence suggesting that a number of more general factors are important in assessing branch potential. This research focuses on these. A number of geographically related factors are proposed that may be considered in making decisions about closure. GIS procedures and functions are used to translate these general factors into a set of specific spatial criteria. A Spatial Decision Support System, designed specifically to address the problem of branch bank closure, is then used to evaluate individual branches against the criteria and to generate a preference ranking that may be used by decision-makers to identify individual branches as candidates for closure. An evaluation and sensitivity analysis of the contribution each of the criteria makes to the preference ranking is undertaken. The approach is demonstrated using the branch bank network of the Commonwealth Bank of Australia (CBA) in metropolitan Sydney as a case study.