Impact of Sunoco HQ, Citibank branches leaving Philadelphia

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December 18, 2013 3:42:38 PM PST
There are a couple of relatively small, but high profile business relocations on the near horizon and, in both cases, Philadelphia will lose jobs.

Sunoco, partially housed in the landmark Mellon Bank building, is abandoning Philadelphia for Delaware County taking 120 jobs with them, bound for the Ellis preserve in Newtown Square.

So are 340 employees who will leave Lester, Pa. bound for that Newtown Square campus.

"They're going because they looked at their books and they probably said we need to make a decision for all our customers, for all our vendors to keep costs down and to consolidate," Professor David Fiorenza of Villanova University said.

Professor Fiorenza said he's not as concerned as he could've been about the impact on the city.

"I'd be concerned if there were larger numbers leaving the city and I don't see that right now," Fiorenza said.

Citibank is moving completely away from Philadelphia and the Delaware Valley.

Next year, the multinational says, it will close its 10 remaining branches in the region. Citibank hit the Philadelphia area with a splash back in 2006, opening up 23 local branches within 2 years. But that fast paced growth came to a halt when Citibank was hit hard by the recession.

Citibank reportedly has $2-billion in local deposits, but they haven't been able to compete with Wells Fargo, TD, PNC, and others who are pulling in far more here.

"They're making a conscious decision to be much more of a global bank, emphasizing that in emerging markets and expanding in those areas, like the Middle East," financial advisor Paul Glesinger said.

Glesinger says the profit margin on bank branches is very small and he foresees dramatic changes in the way banking will be done in the future.

"We're moving into a world, Wells Fargo is experimenting with this too, with having what they call Virtual Branches, branches that are not even staffed by people," Glesinger said.

But for global behemoth Citibank, staying in Philadelphia is not financially worthwhile.

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