[Posted Friday, February 11, 2022]
In a letter to local customers dated February 4, Key Bank announced the permanent closure of its Hillsdale branch, effective May 6, 2022, at 3pm. The ATM and night deposit will be closed and safe deposit boxes relocated to the customer’s branch of choice.
The letter describes the closure as a combining of the Hillsdale outlet with the Raleigh Hills branch and invites bank customers to begin banking at Raleigh Hills at any time. In an email, a Key Bank spokesperson explained that for some time the demand for digital banking has outpaced that for in-person services, adding “since the pandemic began, those trends have increased at an even higher rate.” Key Bank is not consolidating any other branches at this time.
CNBC reported in January that banks in the United States closed almost 3,000 branches in 2021, calling it a record number that reflects trends toward consolidation and digital delivery of services. Bank of America’s Hillsdale branch has been closed except for the ATM since August 2020, one of a dozen such closures in the Portland area. The bank’s website and window signage say the closure is temporary. It’s not unreasonable to wonder, though, if the closure will end up being permanent: Bank of America opened a newly constructed branch a few miles west on Beaverton-Hillsdale Highway just before the pandemic and banks in general are maintaining fewer brick and mortar outlets.
The departure of Key Bank and the uncertain status of Bank of America leave OnPoint as the only financial services institution in the neighborhood.
The location currently occupied by Key Bank has housed a bank since 1956, although the names have changed over the years. Hillsdale residents recall free coffee and cookies, as well as a seasonal Santa in decades past.
The closure will definitely be a loss for the neighborhood, says Paloma Clothing co-owner Mike Roach. “Our business began banking there when the bank manager and president of the newly-formed Hillsdale Business and Professional Association, Gary Kurtz, offered my mother (my then-business partner) and me a loan to increase our inventory for our first holiday season in 1975. We have been banking there ever since.” Many Key Bank employees were core volunteers at the annual Blueberry Pancake Breakfast over the years and the bank was a major financial supporter of Hillsdale Main Street, a grant-based economic development program that ran from 2010-2014.
The departure opens up new opportunities for Hillsdale’s remaining financial services provider, OnPoint Community Credit Union.
If you’ve been around Hillsdale for a few years, you may recall that back in 2011 local residents and business owners lobbied for OnPoint as the anchor tenant for the about-to-be constructed Wardin Building. In the early stages of planning, Chase Bank was in negotiations with the Wardin family for a 30-year lease, but a group of concerned residents felt that a credit union would be a better fit for the neighborhood. In the end, OnPoint secured the lease and took up residence when the building was completed in 2015. (For more on this, take a look at the Hillsdale News archives, and Issue #131 from April, 2014.)
Credit unions offer the same financial services as a traditional bank, but are owned by members and are not operated for profit. Membership is established with a $5 minimum deposit. Hillsdale branch manager Meredith Bureau explained over the phone recently that OnPoint offers members a full range of financial services, with personal and business checking, mortgages, notary, wire transfer, foreign currency exchange and night deposit. Members use the ATM for free; non-members pay a $2 fee per transaction. Unlike Key Bank, OnPoint does not offer safe deposit boxes (there's not enough space and demand is shrinking, said Bureau).
Increasing digital delivery of services means fewer branches, less staff, and lower costs to big banks. According to Bureau, OnPoint can offer a different customer experience from traditional banks because they offer services to members rather than profits to shareholders. “While banking from home is encouraged, we embrace face-to-face interactions and focus more on community,” she says, and points to events like last summer’s children’s book fair as examples. Bureau is also incoming president of the Hillsdale Business and Professional Association.
What’s next for this location after more than 60 years as a bank? It’s too early to know, says Jamie Nelson of NAI Elliott, the commercial leasing agent who manages the property and only recently learned of Key Bank’s plans to vacate. He gets regular calls inquiring about Hillsdale property and when space is available there is high demand, so he anticipates that interest will be strong.
Is the departure of Key Bank a door closing or a window opening? If you were in charge, what new business would you like to see in this space? Let us know.