Wells Fargo & Co. plans to nearly double its retail banking presence in supermarkets following an agreement with a leading national chain.
Last week, Wells, which currently has 550 supermarket branches, announced it had agreed to place 450 additional banking outlets inside stores operated by Safeway Inc. in California and such other western states as Arizona, Oregon, Washington, and Nevada. The bank already has 77 Safeway branches in Northern California.
"This is the biggest single supermarket deal we have ever done," said Margaret Kane, Wells' executive vice president for in-store branching. "Safeway has dominant market share in places where we want to be."
Wells' expansion of its agreement with Safeway comes at a time when many leading banks are striving to create alliances with leading grocery chains before their rivals get to them first.
The number of in-store bank branches in the United States has jumped from 921 in 1990 to more than 3,700 today, according to data provided by International Banking Technologies.
John W. Garnett, president of the Atlanta-based firm, predicts that there will be 5,000 supermarket branches in this country by the end of 1997.
While Wells, which began its relationship with Safeway six years ago, is the nation's leading supermarket banker, others - including Bank America Corp., Banc One, and NationsBank Corp. - are developing outlets outside of traditional bank lobbies.
The new in-store locations will range in size from 36 to 600 square feet. The size will vary according to local market needs and availability of space in the store.
The locations will be full-service facilities offering certificates of deposit, acceptance of deposits and withdrawals, opening of checking and savings accounts, applications for consumer loans, and investment opportunities such as mutual funds and annuities. The facilities will be staffed with bank officers.
Wells Fargo has deep historical roots in marketing its services through retail outlets. During the mid-19th century California gold rush, the bank opened offices inside general stores and local businesses to provide banking and express services to the pioneer miners, merchants, and settlers.