美國大型銀行業(yè)：分行網(wǎng)絡(luò)和戰(zhàn)略指南（卷三）

1、GlobalResearch2 December 2019Large Cap BanksAmericasUBS Evidence Lab inside: Take it to the bank - a guidetobranchnetworksandstrategies,volumeAmericasProprietary reference guide on branch networks and strategiesWeanalyzedUBSEvidenceLabdatatoproducevolumeIII(seevolumesIandII)ofour branchbankingguide.

2、Theanalysisreviewsmorethan80,000branchlocationsgoing back to 1993 to assess geographic and demographic trends around footprints. We think the report provides a useful starting point to assess branch rationalization opportunities,alongwithgrowthoutlooksandcompetitivedynamicsaroundindividual footprint

3、s (see heat map on page 11). Overall, national banks have higher income levels/populationdensitiesandsoutheasternbanksstrongerpopulationgrowtharound footprints.BanksinthemidwestandupstateNYhavelessattractivedemographics.From branch rationalization to branch repositioning strategiesTechnology is chan

4、ging how consumers interact with banks. Branch traffic continues falling and the need for expansive networks in core markets is diminishing. However, the branch is not dead. Even the largest US banks are not present in all geographies they want to be in. For many, establishing limited presences in n

5、ew markets is partof an omni-channel strategy marrying digital capabilities with physical footprints. This is truenotonlyofJPMorganandBankofAmerica,butforselectregionalbankstoo.Early returns on branch expansion efforts are encouraging for Bank of America We used FDIC data to see if branch expansion

6、efforts at Bank of America and JPMorganareyieldingdepositgrowthinnewmarkets.Itisearlydays.However,Bank ofAmericaisgainingsomeshareinMinneapolis,Denver,Pittsburgh,andIndianapolis, key expansion markets. Bank of America added $7.4 bn of deposits in these markets fromJune2016toJune2019.Reachingjust5%sh

7、areintheseMSAs,byourestimates, represents a $14 bn deposit opportunity. Our Buy ratings on Bank of America and JPMorganarebasedontheviewthattheyarelongtermwinnersinUSbanking.Branch overlap suggests cost save goals feasible for BB&T/SunTrust (Truist) 52%ofBB&TandSunTrustbranchesresidewithinafiveminut

8、edriveofwhatwillbea Truist branch. This overlap rate is highest of any bank we cover. The ample overlap suggestsamplerationalizationopportunities.Inapriorreport(seehere),weestimated that closing 25-30% of branches entailed limited loss of household coverage and generatedannualcostsavingsof$387-465mn

9、,or24-29%ofthenetcostsavetarget.Financial ServicesEquitiesSaul MartinezFinancial ServicesEquitiesAnalyst HYPERLINK mailto:saul.martinez +1-212-7132491BrockVandervlietAnalyst HYPERLINK mailto:brock.vandervliet +1-212-7132382AntonioChapaAnalyst HYPERLINK mailto:antonio.chapa +1-212-7132213Frieda Assoc

10、iateAnalyst HYPERLINK mailto:frieda.gonzalez +1-212-7134086Figure 1: Bank of America has gained deposit share in select expansion markets4.7%2.9%2.0%4.7%2.9%2.0%0.0%1.7%0.0%0.0%0.5%3.0%1.0%Indianapolis- Carmel- Anderson, INDenver- Aurora- Lakewood, Indianapolis- Carmel- Anderson, INDenver- Aurora- L

11、akewood, COMinneapolis- St. Paul- Bloomington, MN-WIPittsburgh, PAFigure 2: BB&T and SunTrust will have half of their branches within a 5 min drive of each other70%60%50%40%30%20%10%0%52%48%38%35%32%29%29%27%26%26%70%60%50%40%30%20%10%0%52%48%38%35%32%29%29%27%26%26%25%24%20%19%11%2Q19Source:FDICSou

12、rce: UBSEvidenceLab.Note:Measurespercentageofbranchesresiding withinafiveminutedriveofanotherbranchofthesamebanner. HYPERLINK /investmentresearch /investmentresearchThis report has been prepared by UBS Securities LLC. ANALYST CERTIFICATION AND REQUIRED DISCLOSURES BEGIN ON PAGE102. UBSdoesandseeksto

13、dobusinesswithcompaniescoveredinitsresearchreports.Asaresult,investorsshouldbe aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.Contents HYPERLINK l

14、_TOC_250008 Selectobservations HYPERLINK l _TOC_250007 Howwethinktheanalysisfitsintoselectstocknarratives HYPERLINK l _TOC_250006 Comparingdemographicsandcompetitivedynamicsacrossnetworks HYPERLINK l _TOC_250005 What are the early returns on the branch opening strategies of Bank of AmericaandJPMorga

15、n? HYPERLINK l _TOC_250004 BankofAmericaEarlysignsareencouraging HYPERLINK l _TOC_250003 JPMorganTooearlytotell HYPERLINK l _TOC_250002 Branchcountreductionshavenotledtodepositshareloss14 HYPERLINK l _TOC_250001 More on methodology: what we do inthisreport15 HYPERLINK l _TOC_250000 Caveatsandlimitat

16、ionsoftheanalysis17Company Overviews21Appendix96Large Cap Banks 2December2019Figure 3: Key observations for select large cap banks in UBS coverage universeCompanyRatingPrice Did you know?NationalJPMorganBuy132BankofAmericaBuy34CitigroupBuy93WellsFargoNeutral49BB&T+SunTrustMoreBB&T+SunTrustMorethanha

17、lf(52%)ofbranchesarewithinafiveminutedriveofanotherTruistbranch Neutral52-1.2%annualpopulationgrowthintop10MSAshasbeenwellabovenationalaverageLeading positions in DC, Atlanta, Miami, Tampa/St. Pete, Baltimore, Charlotte, andOrlando48% of branches are within a five minute drive of another Chase branc

18、h (only Truist is higher)Household incomes around branch footprint are above peer averageToo early to tell whether branch expansion in new markets is workingOver $7 bn in deposit growth in select expansion markets in past three years (Minneapolis, Indianapolis, Denver, and Pittsburgh)Top 3 deposit s

19、hare in each of its largest 10 MSAsBranch presence only in NYC, DC, Miami/South Florida, Chicago, the SF Bay Area and LA/SouthernCaliforniaBy far the highest household income and density (number of households) around footprintPopulation growth of only 0.2% annually in leading MSAs from 2015-201838%

20、of branches have another Wells branch within a five minute drive (only Truist and JPM are higher)Onlynationalbankwithaboveaveragepopulationgrowthinitstop10MSAs(0.8%annually)Only 36% of branches are in its top 10 MSAs, however; a more dispersed network than all peersUS BancorpNeutral- Differentiated

21、branch model (urban/suburban, community and in-store). Analysis in this report does not include in store branches58- 3.4% reduction in branches Y-Y through Sep 2019; branch rationalization has begun in earnestAmong lowest household income levels around branch network; only Regions is lowerDouble dig

22、it market shares in Portland and SeattlePNCNeutral146- Population growth averaged only 0.2% annually from 2015 to 2018 in top 10 MSAs- Total branch count declined 21% from 2012 to June 2019RegionalCitizensNeutral- Per capita incomes around branch networks among the highest in our coverage39- Annual

23、population growth of only 0.2% in top 10 MSAs from 2015 to2018- Healthy market positions in Cleveland, Pittsburgh, and upstate NY, not just northeastern marketsM&TNeutral161- Average annual population growth of only 0.2% in top 10 MSAs from 2015 to2018- Branch count has been roughly flat since 2009

24、despite acquisitionsKeyCorpBuy22- Only 19% of branches reside within a five minute drive of another Key branch, a low overlap rate vs most peers- High single digit to low double digit branch and deposit shares in Seattle, Portland, and DenverFifth ThirdBuy33-BranchoverlaprosewithMBFinancial,butitrem

25、ainsatthelowendofpeers- 9% share of branches in Chicago leaves it only behind JPMorgan ChaseRegionsBuy18- Lowest household income around branch footprint of any bank we cover- Annual population growth of 1.1% in top 10 MSAs since 2015 is well above averageHuntingtonBuy- HBAN is one of the most activ

26、e in the sector in ongoing efforts to optimize its branch footprint.15.50 - In 2019 this included sale of its Michigan branches to fund technology spending and improve its franchise growth profileComericaNeutral68- CMAs deposit gathering success which saw consistent outperformance historically now m

27、oves into line with thesectorZionsNeutral49- While continuing to rationalize branch footprint, ZION benefits from the fastest growing group of MSAs in our coverageNote: Our rating for SunTrust is Neutral with a price target of $67. Source: UBS estimates, UBS Evidence Lab.Large Cap Banks 2December201

28、9We are publishing the third version of our branch banking reference guide, leveraging data from UBS Evidence Lab. The report analyzes geographic, demographic,andcompetitivetrendsaroundthebranchnetworksofbanksinour coverage. As with prior versions, our analysis reviews more than 80 thousand branchlo

29、cationsgoingbackto1993.Weevaluateeachbanksfootprintbasedon branch overlap levels, household density, per capita incomes and the number of competitorbrancheswithinafiveminutedrivetimeofexistingbranches.Wealso show deposit shares and branch count data by state and MSA, along with demographic quality m

30、easures of theselocations.Whats new this year? We add new features to each version of the report. The most material addition is a preliminary assessment of efforts by Bank of America andJPMorgantogainshareinexpansionmarkets.Wealsoassessdepositshare evolution in markets where the banks we cover have

31、cut the most branches. Our goalistogaugewhetherbranchcutsareleadingtosharelosses.Select observationsBelow,webrieflyprovidekeytakeawaysfromtheanalysis.Someobservationsare similar to those discussed in prior versions of thereport.The branch networks of JPMorgan, Citigroup, and Bank of America residein

32、higherincomeandmoredenselypopulatedmarkets.JPMorgan, BankofAmerica,andCitigrouphavehigherhouseholdincomelevelsandmore householdswithinfiveminutedrivesoftheirbranches.Citigroup,inparticular, has the highest per capita income levels and household density within a five minute drive of its branch networ

33、k, while income growth was fastest in its top ten MSAs from 2015 to 2018. Population growth, however, in its leading MSAsiswellbelowthepeeraverage.Ofthenationalbanks,WellsFargoisthe only national bank with average household income levels and density levels near the peer group average. Interestingly,

34、 Comerica also has elevated householdincomelevelsandhouseholddensityarounditsbranchnetwork.See Figure 12 for moredetails.Too soon to tell on branch expansion efforts, but some encouraging early signs at Bank of America. Bank of America and JPMorgan have in recentyearsdiscussedplanstoopensignificantn

35、umbersofbranches,manyin newmarkets.Itistooearlytoprovidedefinitiveassessmentsofthesuccessof these strategies in gathering clients and deposits. However, the early returns appear encouraging for Bank of America. The company has gained share in Minneapolis, Denver, Pittsburgh, and Indianapolis over th

36、e past three years, adding $7.4 bn of deposits in these four markets from June 2016 to June 20191.JPMorganonlybeganopeningbranchesinexpansionmarketsinearnest in2H18.Itistooearlytoassessthesuccessoftheirefforts.Our analysis reviews more than 80 thousand branch locations going back to 1993JPMorgan, Ba

37、nk of America, and Citi have higher household income levels and more households within five minute drives of their branchesBank of America has gained share in Minneapolis, Denver, Pittsburgh, and Indianapolis over the past three years, adding $7.4 bn of deposits in these markets1 FDIC.Large Cap Bank

38、s 2December2019Figure 4: Bank of America has gained deposit share in select expansion markets2.9%2.02.9%2.01.7%0.0%0.0%0.5%0.0%4.0%3.0%2.0%1.0%0.0%4.7%Indianapolis- Carmel-Anderson, INLakewood,COIndianapolis- Carmel-Anderson, INLakewood,COMinneapolis-St. Paul-Bloomington, MN-WIPittsburgh, PASource:

39、FDICTrue that2: considerable branch overlap suggests ample rationalization potentialatTruist(BB&TandSunTrust3).Weagreewiththeviewthatthere areconsiderablepotentialcostsavingsfrombranchclosures.Asshowninthe first exhibit below, the merger will increases the level of branch overlap, making it the only

40、 bank we cover with more than half of branches residing within a five minute drive time of another branch of the same banner. While BB&T has not provided explicit branch cutting goals, our past analysis has suggested that BB&T would lose little household coverage if it closed 25% of the combined ban

41、ks branches. Moreover, population growth is higher than average within its footprint (though household density around the network is lower than average).Figure 5: On a pro-forma basis, BB&Ts branch overlap increases significantly after the merger with SunTrust . . .BB&Tstand-alonePro-formaBB&T+ SunT

42、rustTruist will be the only bank we cover with more than half of branches residing within a five minute drive time of another branch of the same banner80%53%52%70%53%52%43%42%40%38%36%60%43%42%40%38%36%33%32%31%29%26%50%33%32%31%29%26%40%30%20%10%200820092010201120122013201420152016201720183Q190%200

43、820092010201120122013201420152016201720183Q19Source: UBSEvidenceLab.Note:datapriorto2018isforBB&Tasastand-alone.Beginningin2018,thedatais presented on a pro-formabasis.2 Wiktionary: (colloquial) Used to show agreement; indeed.3 Truist will be the name of the merged entity. The banks expect the merge

44、r to close on 12/6/2019.Large Cap Banks 2December2019Figure6:.andbranchoverlap(cannibalization)within5minutedrivetime will be the highest among all banks wecover52%48%52%48%38%35%32%29%29%27%26%26%25%24%20%19%11%Wells BankofAmericaComericaM&T PNCUS BancorpFifth Third Huntington 0%10%20%30%40%50%6Sou

45、rce: UBS Evidence LabPopulation growth is faster around the branch networks of southeastern banks. Population growth between 2015 and 2018 in the top 10 MSAs of BB&T/SunTrust (Truist) and Regions was far faster than thepeer group average even though household density within a five minute drive time

46、remains lower than average for both banks. We also note that population growthinthetop10MSAsofZionswaswellabovethepeeraverage.Deposit market shares have been resilient despite branch closures. It doesnt appear to us that branch rationalization strategies have resulted in significant share losses, ev

47、en in markets where branch cuts have been most significant. In particular, excluding KeyCorp and Fifth Third (which undertook material acquisitions), the total branch count of the banks we cover declined 7% from 2Q16 to 2Q19, yet overall deposit shares were essentially flat. In addition,evenintherou

48、ghly150MSAswherebranchcountsdeclinedbymore than ten percent over the aforementioned three year time horizon, market sharesincreasedalmostathirdofthetime(32%)andfellbylessthan1ppin 47% cases.Large Cap Banks 2December2019Figure 7: Banks that closed 10% or more branches inkey MSAsfromJune2016toJune2019

49、generallydidnotsee significant deposit market sharelosseslower, 47%pplower, 7%pplower, 4%pplower, 5%5-10 pplower, 5%Increased, 32%Source: FDIC,UBS.Note:Includesdataforeachbankstop25MSAswhere branches declined by 10% or more between 2Q16 and2Q19Figure 8: Large cap banks reduced their US branch networ

50、ksby7%onaveragebetween2Q16and2Q19and theirdepositmarketshareremainedmostlyunchanged% Increase / (Decrease)in Branch CountMkt ShareppChangeJPMorgan-7.2%0.0%Bank of America-8.8%-0.1%Citigroup-6.0%0.0%Wells Fargo-10.4%-0.1%US Bancorp-7.5%0.0%PNC-10.8%-0.1%BB&T-20.6%-0.2%Suntrust-18.7%-0.1%Fifth Third1.

51、3%0.1%KeyCorp17.1%0.2%Regions-8.7%-0.1%Citizens-9.3%0.0%M&T-6.1%-0.1%Average-7.4%0.0%Source:FDIC.Note:KeyCorpsbranchcountincreasedasaresultduringthis periodasaresultoftheFirstNiagaraacquisition.FifthThirdsbranchcount increased due to the MB FinancialacquisitionDespite aggressive branch reductions in

52、 recent years, rationalization opportunitiesremainrelevant.Branchoverlap(cannibalization)hasdeclined materially (and steadily) since the end of the financial crisis. Nonetheless, we stillseeopportunitiestoparenetworks.AsshowninFigure6above,elevenof fifteenbanksanalyzedhavemorethan25%oftheirbranchesr

53、esidingwithina five minute drive of another one of their ownbranches.How we think the analysis fits into select stock narrativesBank of America and JPMorgan (both Buy rated) stand in a privileged position to benefit from branch expansion. While early days, we think the early returns on new market ex

54、pansion are encouraging as Bank of America hasbeenabletogaindepositshareinselectexpansionmarketswherefinancial centers have been opened in recent years. When expanding in new retail markets, Bank of America and JPMorgan are able to benefit from nationally recognizedbrands,anexistingpresence(viawealt

55、hmanagement,commercial banking),andtheperception(andperhapsreality)ofofferingbettertechnology forcustomers.Otherbankslookingtoexpandgeographicallydonothavethese attributes, in our view. Ultimately, we see Bank of America and JPMorgan as better able than peers to establish toe holds in new markets wi

56、th limited branchpresencesevenastheyparebranchesinlegacymarkets.Branch rationalization suggests $1.6 bn net cost save target is feasible for Truist (merged entity between BB&T and SunTrust, both Neutral). The considerable branch overlap suggests ample branch rationalization opportunities. In fact, i

57、n our prior report, we estimated that closing 25-30% of branches entailed losing coverage of only 3-5% of income weighted householdsandgeneratedannualcostsavingsof$387-465mn,or24-29%ofEleven of fifteen banks analyzed have more than 25% of their branches residing within a five minute drive of another

58、 one of their own branches.We see Bank of America and JPMorgan as better able than peers to establish toe holds in new markets with limited branch presences even as they pare branches in legacy marketsThe considerable branch overlap at Truist suggests ample branch rationalization opportunitiesLarge

59、Cap Banks 2December2019the net cost save target. However, elevated integration risk and premium valuations prevent us from taking more constructive views on BB&T and SunTrust shares. Ultimately, we think that greater visibility on the combined earnings power in 2021 is needed for the stock to outper

60、form on a sustained basis.Branch rationalization opportunities suggest potential to optimize cost structureismaterialforWellsFargo(Neutral).Despiteamaterialincrease inthepaceofbranchclosuressince2016,38%ofWellsFargobranchesreside within a five minute drive of another Wells branch. This overlap rate