Naomi Snyder| Special to Nashville Tennessean
The largest bank in the nation, JPMorgan Chase & Co., has kicked off an expansion spree into Nashville, opening two branches within the last week and planning eight by the end of the year. One of those branches opens Tuesday in Green Hills, at 3811 Hillsboro Road.
Ultimately, Chase Bank wants 15 to 20 branches in the Nashville area within the next five years, which could give other large banks such as Pinnacle Financial Partners and Bank of America Corp.a literal run for their money.
However, despite Chase’s size, technological prowess and its sleek and modern branch design, it won’t be easy to steal market share in an area that’s already saturated with banks.
“It’s assumed they’re going to take over the world," said Marty Mosby, director of bank advisory and strategic services for broker-dealer Vining Sparks in Memphis. “I don’t think that’s true.”
Nashville has experienced such phenomenal growth in recent years that banks have clamored to get a piece of the market. Nashville was named the second hottest labor market in 2019 after Austin, Texas, among 381 metro areas last year by The Wall Street Journal and research firm Moody’s Analytics. Despite multiple bank mergers, there were still 65 institutions in the Nashville Metropolitan Statistical Area in 2019, up from 63 in 2015.
“Nashville is the darling of metro areas right now," Mosby said.
All that competition has been great for customers, but makes it tough to be a bank.
“There are too many banks chasing the deals there," Mosby said. “It’s a very aggressive pricing market.” Loans that might not get funded in other cities get funded in Nashville because of the strength of the local economy, he said.
Of course, COVID-19 makes it tough to bet on Nashville’s economy in the short term. But Chase has been gearing up for this moment for years and has the size and strength to back up its investments.
Based in New York City, JPMorgan Chase & Co. has about $2.7 trillion in assets and is slightly bigger than the No. 2 bank nationally, Bank of America Corp, according to the Federal Reserve. JPMorgan Chase spent more money on technology than any other bank last year, at $11.4 billion, according to Business Insider. Customers can use the Chase mobile app to open a new bank account, transfer funds or even send tax documents to their accountant.
Still, retail branches are a fundamental part of Chase’s growth strategy. Chase has been in Nashville since 2011 serving big commercial customers and high-net-worth individuals out of an office at 1201 Demonbreun in downtown. Chase is opening retail branches here now because it is trying to expand into many of the top 100 metro areas in the country, Mosby said. Opening retail branches in Nashville and suburban neighborhoods means it can vie for consumer deposits and loans as well as serve small business and middle-market business owners.
Despite JPMorgan’s sizeable investments in digital banking, “we still see the value of brick and mortar," said Denise Horvath, the market director in charge of Chase’s expansion here. “It’s great marketing.”
That doesn’t mean the branches look like traditional banks, however. Walk into the downtown Nashville branch at Fourth Avenue and Church Street that formerly housed Republic Bank & Trust Co., and there’s no teller line in sight. Glass-walled offices line the sides of the 4,500-square-foot location, where customers can talk one-on-one with bankers. A couple of couches and overstuffed chairs surround a large-screen TV, now showing the bank’s remote Chase Chats, or virtual financial classes. Or customers can use one of two next-generation ATMs inside the front door, from which they can pay credit card bills, transfer funds and do a variety of other transactions. The two teller lines are behind the TV wall but Horvath said there are no tellers here — only associate bankers who can handle more transactions than a typical teller, including opening new accounts.
In this branch, the markings of the pandemic are everywhere. One of the teller lines is closed and blue tape on the floor tells customers where to stand. There’s an “X” mark on some of the cushions to keep customers at least 6 feet apart.
Horvath said the tough times haven’t changed Chase’s expansion plans for the area. She’s now in the process of trying to hire 150 employees by the end of the year and says Chase’s minimum wage is $15 per hour.
Jeff Davis, managing director and bank consultant in Nashville for Mercer Capital, said Chase will have to do a lot more than just hire.
“It’s going to take a lot of patience," he said. “It’s going to require some key hires who can take market share.”
Davis explained that it’s hard for customers to switch banks given the amount of work involved, and that deters many from even trying it.
Banks such as Pinnacle, Bank of America, Regions Bank and First Horizon Bank (formerly First Tennessee Bank), have long established roots here. Even if Chase manages to get 15 to 20 new branches within five years, that won’t match some of the biggest players. Pinnacle has 30 offices in the Nashville area and Bank of America has 34, according to the latest FDIC data from 2019.
“They are going to have to figure out how to marry their technology and national brand name with locations in growth areas and have bankers who are good at sales," Davis said.
To do that, they need to start with branches.
New Chase bank locations around Nashville
Chase Bank opened its first retail branch last December in Berry Hill. Here are its planned 2020 branch opening locations and dates.
- Downtown, 201 Fourth Ave. N. — July 7
- Green Hills, 3811 Hillsboro Road— July 14
- Smyrna, 491 Potomac— September
- Donelson, 2400 Lebanon Pike — October
- East Nashville, 1121 Gallatin Ave. — October
- Belle Meade, 4317 Harding Pike— November
- North Nashville, 2611 Clarksville Pike— November
