- Key insight: Citizens will shutter at least 100 in-store branches over the coming years, largely ending its long-running presence in grocery stores.
- What's at stake: The switch in strategy mirrors an industry-wide shift away from in-store branches.
- Forward look: The bank will provide more details about which locations will close and where new branches will open once it scouts locations and irons out its contractual obligations, CEO Bruce Van Saun said.
Citizens Financial Group plans to close most of its in-store branches over the next several years and replace half of them with new, standalone branches that will include wealth managers and small-business bankers.
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The initiative, unveiled Thursday, involves shuttering 100 to 120 supermarket-based branches over the course of a decade and building 50 to 60 nearby traditional branches, in an effort to attract more retail deposits. The program, which will be partially funded from savings related to in-store costs, could generate an incremental $20 billion to $30 billion in low-cost deposits, the bank said. The bank currently has 119 in-store branches, a spokesperson said in an email.
The move cements a change in Citizens' long-standing retail branch strategy, which has included in-store branches in regional supermarket chains such as Stop & Shop, Tops Friendly Markets and Giant Eagle. The $233.8 billion-asset bank has been trimming its full-service grocery-store branches for many years, mirroring the industry's shift away from such operations as customer behavior has changed.
While some banks seeking a deposit haul are entering new markets or buying other banks, Providence, Rhode Island-based Citizens aims to "double down in the geographies we already serve, where our name is already known," CEO Bruce Van Saun told American Banker. "This type of careful investment in physical locations and in people, if executed well, should create a nice lift in the deposit trajectory without taking on the risk and significant capital expenditure of opening a whole bunch of de novos outside of the footprint."
The details of Citizens' new branch strategy came three months after the company teased that changes were on the horizon, with an eye toward capturing more customers, more households and more deposits. On Thursday, Van Saun said the bank has a lot of work ahead to prepare for the transitions, including ironing out its contractual obligations with store owners and identifying potential locations for new offices. Timing is key, as the bank seeks to have a new standalone branch up and running at the time the in-store branch closes.
Staffing at the new branches will include private client-bankers and specialists in wealth and small business, though the exact makeup will be determined by branch, Van Saun said.
Citizens, the parent company of Citizens Bank, isn't the only bank choosing to focus its branch strategy on what it already has. Citi is also zeroing in on its existing retail franchise, as it plans to renovate a significant portion of its 650 U.S. branches between now and 2028, making the offices more advisory in nature.
Citizens has 977 branches across its footprint, according to data from the Federal Deposit Insurance Corp. As of June 30, 2026, its deposits totaled $185.6 billion, 47% of which were retail and 25% of which were commercial, according to the bank's second-quarter earnings materials.
The revamp won't impact Citizens' ability to achieve a key profitability target, executives said during the bank's second-quarter earnings call. It is still aiming for a return on tangible common equity of 16% to 18% by the end of 2027.
During the second quarter, that metric came in at 13.9%, up from 12.2% in the prior quarter.
Robust results
In line with other large and regional banks, Citizens reported a strong second quarter. Its net income was $587 million, an increase of 35% year over year. Earnings per share totaled $1.30, beating the estimate of $1.24 that analysts polled by S&P Capital IQ had forecasted.
Revenues came in at $2.3 billion, up 12% from the same quarter in 2025. Expenses rose 6% to $1.4 billion, driven upward by higher salaries and benefits tied to the private bank and private wealth build-out, compensation associated with growth in capital markets fees and about $7 million in costs related to Citizen's multiyear, AI-focused technology-overhaul program.
Citizens' 3-year-old private bank continued to pay dividends. For the quarter, it reported $18.3 billion of average deposits and $8.4 billion of average loans, along with $9.6 billion of client assets under management. Citizens now operates 10 private banking offices, including six in California, and one in West Palm Beach, Florida, which opened during the quarter.
The private bank contributed 15 cents to earnings per share, up four cents from the first quarter.
Another six private banking offices are expected to open during the first half of 2027, including one in Beverly Hills, California, and another in Greenwich, Connecticut, the bank said.
Citizens has brought on 11 advisor teams since launching the private bank in 2023. On Tuesday, Van Saun said he expects that number to grow to 30 over the next few years.
Brendan Coughlin, Citizens' president who recently gained additional responsibilities, reflected Thursday on the build-out of the private bank, which was a response to the 2023 failure of First Republic Bank in San Francisco and Citizens' desire to jump into the private-banking business.
"The first maybe two years, we were held back intentionally on going really fast on growth to make sure we can demonstrate to ourselves that we can build this model and do it effectively and deliver effectively for our clients while maintaining a profitability profile that's accretive," Coughlin told analysts on the earnings call. "We feel really good about that now, and so we are in the mode of expansion."
Citizens' stock price was trading up by more than 4% Thursday. The KBW Nasdaq Bank Index closed down by less than 0.1%.
