Independent Bank Corp. of Ionia, Mich., is consolidating 14 of its 74 Michigan branches.
As part of the consolidation, six branch offices will close. The process will be completed by the end of April, the $2.3 billion-asset company said Friday.
Overall, the consolidation will save the company about $1.6 million a year in expenses. However, Independent is projecting the loss of $300,000 to $400,000 in annual revenues due to customer erosion.
Independent expects to incur one-time expenses of approximately $300,000 in the first quarter due to the consolidation, consisting mainly of severance and other costs.
The board of directors approved the consolidation on Jan. 21. The company does not expect to assume any losses disposing the closed branches' assets.
"Branch transaction volumes are declining, while mobile and other electronic channels continue to experience greatly increased usage," said William Kessell, president and chief executive of Independent Bank, in a press release. "It is necessary to continually evaluate our branch office footprint and make necessary adjustments in response to these changing transaction patterns."
In 2012, Independent sold 21 branches to its in-state rival Chemical Financial for about $12.4 million.
Separately, Independent reported that net income dropped 19% compared to a year earlier, to $3.9 million. Earnings per share of 17 cents fell two cents short of the average estimate from analysts polled by Bloomberg.