We are not aware of any laws that address a reduction in branch hours, and so we can only make suggestions as to reputation risk and CRA risks. The Illinois Promissory Note and Bank Holiday Act imposes duties when a bank plans to close a branch one day per week, but it is silent as to a reduction in hours. 205 ILCS 630/17.

You should review any disclosures and account agreements to see if you have agreed to provide certain notifications about the change in hours. It would be prudent to provide advance notice of the change in hours, update any advertising, listings, and information about the branch to reflect the new hours, and update disclosures and account agreements (which changes may require notice to customers). Also note that the cut-off hour for the receipt of deposits may be no earlier than 2:00 p.m. (or 12:00 p.m. for ATMs) under Regulation CC; if you are closing earlier than that time, you may have to revise the funds availability language in your deposit agreements. 12 C.F.R. 229.19(a)(5)(ii).

The change in hours may raise some Community Reinvestment Act (CRA) concerns. One factor in your service performance rating is whether a branch’s services, “including, where appropriate, [its] business hours,” vary in a way that inconveniences customers in your assessment area. See Appendix A to Part 228—Ratings, Part (b)(3) (2011). Therefore, it would be prudent to document your reasoning for making the change and to contact your regulator, though you are not required to do so. As part of your documentation process, you may want to include the following information, adapted from the Metavante policy on branch closings:

• The bank’s efforts to keep the branch profitable in the hours that are being reduced;
• The branch hours of other financial institutions in the branch’s neighborhood;
• Any actions taken to notify the public and your customers of the change in hours, with copies of any notifications; and
• Any actions taken to minimize the impact of the change in hours.