It's a violation of Utah law and certainly of Utah tradition, but U.S. Bank said Monday it plans to begin opening on Sundays at five of its in-store branch banks in the state, beginning this summer.
"Some people may be offended, but we think it's in the best interest of our customers," said Berniel L. Maughan, president of U.S. Bank Utah.The decision will make U.S. Bank, a subsidiary of Minneapolis-based U.S. Bancorp, the first bank in Utah to operate on Sundays.
The branches in question are located in five SuperTarget stores along the Wasatch Front in which U.S. Bank currently has full-service banks. The branch offices will open beginning July 5 each Sunday from noon to 4 p.m..
Maughan said bank employees will not be required to work on Sunday and the bank's 26 free-standing branches in Utah will remain closed.
Maughan said the decision came following a survey it conducted that indicated more than half of its customers shop on Sundays, and 48 percent would consider Sunday banking if it were available in their grocery store.
Utah law currently prohibits banks from opening on Sundays or holidays, and it's clear that state-chartered banks, most often the smaller institutions, would not be able to open on Sundays under the current statute.
But federally chartered banks, which include the large institutions such as First Security, Zions, Key Bank, Bank One, Wells Fargo and U.S. Bank, say they are not governed by state laws and, without a court test, they may be right.
"Utah law prevents Sunday openings, but the federal agencies believe that federal law pre-empts state law and the attorneys say that's probably correct," said G. Edward Leary, state commissioner of financial institutions.
It would likely take a judicial ruling to force compliance, but Leary says he sees no court challenge coming in regards to the issue.
What he does foresee, is one or more state chartered banks asking that the law be changed.
"This decision by U.S. Bank will cause competitive issues to arise," said Leary, "and each institution will have to make the choice of whether to follow suit or not. The issue becomes, do we go to the Legislature and ask them to look at the law? It's too soon to say whether we'll do that, but at this point I would respond favorably to a request by a state bank that asks for this to be looked at."
If the public demands banking services on Sunday and the nationals are allowed to offer it, said the commissioner, "Then I would think state banks should be allowed as well."
While First Security Corp. does not open its in-store branches on Sunday in Utah, its in-store operations in New Mexico and Wyoming do have Sunday openings. Zions Bancorp.'s in-store branches in Utah and Idaho are closed Sundays, but open in Nevada. Wells Fargo in-store banks are closed in Utah on Sundays but open in the seven other states in which it does business. KeyBank's in-store branches are closed Sunday in Utah but open in Washington and Colorado.
Becky Wilkes, vice president of the Utah Bankers Association, agrees that the U.S. Bank decision will make all bankers at least think about the issue from a competitive standpoint.
"I have heard other bankers talk about doing this and (U.S. Bank's) decision opens the door for them, although I'm not in a position to predict what they will do," said Wilkes.
"But I wouldn't be surprised if others followed their lead. U.S. Bank is just responding to the needs of their customers and this gives them a little bit of an edge on the competition. It's been going on in other states, but it's new here."
Brad Baldwin, president of Bank One Utah, said his bank has no plans to open on Sundays but noted that Bank One doesn't have a supermarket alliance as does U.S. Bank and others.
"The stores are open on Sunday and they expect their in-store bank, as their partner, to be open as well," said Baldwin. "It makes more sense than opening a regular bank office on Sunday. I don't think that would be cost effective."
Baldwin said studies indicate that while people go into their bank an average of once every two months, they go to their grocery store an average of twice a week.
"Why have a bank in a grocery store? Because that's where the people are," he said.
While Bank One doesn't open on Sundays in Utah, Baldwin pointed out that it does open locally on Columbus Day, Presidents Day and Veterans Day, traditional "bank holidays" that some other banks in Utah still honor.
Adrian Gostick, spokesman for First Security Corp., said the bank currently has no plans to open any branches on Sundays in Utah despite its policy in Wyoming and New Mexico.
"We gauge customer requirements in an area and make a determination from there," said Gostick.
SuperTarget officials say Sunday is their busiest day of the week, an obvious influence in U.S. Bank's decision. But Maughan stressed that it's just a business decision, not a revolution.
"We understand that not all of our employees and customers will want to come into U.S. Banks on Sundays," said Maughan. "We respect and honor the family and religious commitments of our employees and customers, and, ultimately, will let our customers decide which days they choose to do business with us."
U.S. Bank entered the Utah market in 1995 when then Portland, Ore.-based U.S. Bancorp bought the operations of Boise-based West One Bank, which had earlier entered Utah by acquiring Tracy-Collins Bank and Continental Bank.
Then U.S. Bancorp was itself acquired in March, 1997 by Minneapolis-based First Bank System, which changed its name to U.S. Bancorp.
The five SuperTarget stores at which the U.S. Bank branches will be open Sundays, beginning in July, are in Centerville, Midvale, Orem, Sandy and Riverdale.