NationsBank plans to sell or close 62 branches in Georgia in the wake of its recent acquisition of Atlanta-based Bank South Corp. But one group of facilities remains conspicuously absent from the chopping block: Bank South's 61 supermarket branches.
A substantial branch cutback had been expected after NationsBank agreed last September to purchase Bank South for $1.7 billion. NationsBank's prediction that it would be able to lop off 60% of Bank South's annual noninterest expense, saving $175 million, was based largely on tremendous overlap between the two banks' branch networks in Atlanta.
But NationsBank declined, at the time the deal was announced, to specify how many of the combined companies' 338 offices in Georgia would actually be divested. Customers of the 62 branches slated for closure - both Bank South and NationsBank offices - recently began to receive their notification in the mail.
The decision to retain Bank South's 61 in-store branches comes as no surprise. Long a skeptic on the issue of supermarket banking, NationsBank reversed course last year when it signed commitments in Texas to quadruple its in-store branches in Texas from 11 to 40 by the end of this year.
NationsBank had previously indicated it would also retain most of Bank South's in-store network. "We saw it as an integral part of an overall delivery strategy that focuses on convenience," said Davis S. Bair, NationsBank's consumer banking executive in Georgia.
Mr. Bair said NationsBank has been analyzing the Bank South in-store program to identify possible improvements but has made no major changes.
The branch cutbacks will leave NationsBank with 255 branches - both freestanding and in-store - and 550 ATMs in Georgia.
Job cutbacks in the wake of the Bank South deal will not be as significant as the branch pruning. In a major departure from past policy, NationsBank has guaranteed job security, within normal performance guidelines, to 1,200 Bank South tellers and check handlers and 600 other support staff.
Bank South employed 2,500 people when the acquisition was announced.
Most observers have linked this policy to a desire to avoid bad publicity during the 1996 Summer Olympics, which will be held in Atlanta in July. But Mr. Bair denied such a connection.
"The reason we did that was that there was very little customer overlap between Bank South and NationsBank.
