Banking department to review disclosure of branch closings
The Pennsylvania Department of Banking and Securities has stopped publishing bank closures in the Pennsylvania Bulletin, but it plans to review the matter.
As reported Friday by Philadelphia Business Journal writer Jeff Blumenthal, the department dropped the practice following the modernization of the state Banking Code passed last year. Under the new rules, banks no longer need to apply to the department to close a branch; they only have to notify it that they intend to do so, which does not trigger public disclosure.
Banks still need the department's approval for branch openings, so those will continue to be published.
Banks inform their customers of branch closings, but "that does not help investors or other interested members of the public who rely on press accounts to find out how banks are faring during this still uncertain economic climate," Blumenthal wrote.
The change is not a new policy per se, spokesman Ed Novak told the Central Penn Business Journal. Rather, the Banking Code reforms and last year's merger of the Department of Banking and the Pennsylvania Securities Commission have created new standards for the public release of information, and officials are still clarifying what protocols to follow, he said.
The department was to discuss the issue at a meeting Monday, but it had to be postponed, Novak said. The legal review will take time, he said, adding he could not say when a final decision might be reached.
Banks recognize that shareholders want to know about branch closures that affect operations, such as those resulting from a merger, said spokesman Steve Trapnell of Lititz-based Susquehanna Bancshares Inc.
"That is generally something that is addressed as part of the investor communication," he said