The local bank branch of Flagstar Financial that is present in hundreds of neighborhoods in the U.S. is going to stop functioning, and huge of the Americans are not yet informed of it. According to Flagstar Financial, which is an important regional lender with more than 400 branches as well as having approximately $100 billion in assets, 60 branches will be closed by the end of 2025.
The process of the closings is part of a three-phase cost-cutting strategy that started in March. At the moment, 28 of the locations have already been closed and the rest are planned to shut down by the end of April. The other 32 stores will go out of service later this year, and their exact dates have not yet been made public.
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Why Is Flagstar Closing So Many Branches?
The move came after a loss of $845 million in 2024 and some time after New York Community Bank completed its deal with Flagstar Bank, thus Flagstar Bank was rebranded as Flagstar Financial in October 2024.
In the recent earnings call with the CEO, Joseph Otting, he stated that the bank’s plan is to turn profitable again by the next year’s end. By closing many of the physical locations, the bank could likely save money by reducing real estate, staff, and operating costs.
The bank has completed the procedure of delivering the notice of each branch’s closing to the Office of the Comptroller of the Currency as stated by the Office of the Comptroller of the Currency.
Which States Are Affected?
As of the first round of closures, nine states will be affected:
- New York – 14 closures
- Michigan
Ohio
- Wisconsin
The following branches are mentioned as a few of the specific locations that are closing:
- 720 Grand Blvd, Deer Park, NY
- 8622 Bay Parkway, Brooklyn, NY
- 4025 E Chandler Blvd, Phoenix, AZ
- 2066 Lee Road, Cleveland Heights, OH
- 1401 Presque Isle Ave, Marquette, MI
- 200 S Van Buren St, Auburn, IN
It is understood that the locations that are still open are not yet known, however, the same will presumably be revealed in the next OCC filings that are released. Customers will be able to follow the developments at Flagstar’s official branch locator or sign notices at their local.
Customer
If your local Flagstar Financial branch is on the closure list, you will receive at least 30 days’ notice before it officially shuts down. Your alert will likely arrive by email, regular mail, or signage displayed at the branch.
Here are the expected changes:
- Your accounts will be active
- Offices nearby are going to become the source of in-branch service
- Internet and mobile banking services are still going to be provided
- ATM locations may be shifted
- For an in-person visit, one may have to go to another place
Apart from Flagstar, no other companies seem to have waived fees or provided travel assistance to consumers who are impacted.
How
The shutdowns will definitely have an impact on the staff of Flagstar bank. Thus, some of the employees are likely to be relocated while others are expected to be given a severance package or be laid off.
The bank has not confirmed the scale of the job cuts, but it has been reported that the downsizing is necessary for the bank to be financially healthy again.
A Wider Trend in the Industry
It’s not just Flagstar – we can witness the branch banks closing movement in the whole industry. According to Banking Dive, in 2024 more than 1,000 U.S. bank branches have been closed. The increasing cost of the running of them plus the digitization of banking are the main causes of branch reduction trend.
One among the other banks that are going in the same direction is:
- TD Bank, whereby the number of locations decreased by 38
- Chase, Bank of America, and Citibank who have closed the most or planned to shut down the most (more than 200 branches combined).
At the same time, up to 200 million people in the US are still visiting traditional bank branches to make cash deposits, handle their checks, and get financial guidance, as stated in a report. There are warnings from the experts indicating that if the number of branches is reduced, the situation with the long lines, delayed service, and lack of access could become worse – particularly in the countryside or poor areas.
What Can You Do?
These are the things to do if you are a customer of Flagstar:
- Go to the branch as soon as possible and inquire if it is one of the closed branches
- Open your mail or check your email for official papers;
- Start with mobile or online banking if you’re not signed up
- Find out where the nearest ATM or branch is
- Consult an officer about moving your accounts or tasks
Further announcements are expected to come in the upcoming weeks, and customers can receive the latest news either from Flagstar.com or the ….
The upshot is that the branch of your bank might just be out of there very soon. If you are one of the customers of Flagstar, the time is now to set up without delay for the switch — because the next series of shut-downs will appear shortly.
