Updated February 21 at 1:56pm

Coffee and credit on this Citizens’ menu

The announcement that Citizens Bank has opened a branch inside a Dunkin’ Donuts has sparked a debate among local bankers, with some raising doubts about whether it will work but others arguing the two brands are a perfect fit.

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Coffee and credit on this Citizens’ menu


To Martin Bischoff, a coffee shop that offers certificates of deposit along with Boxes O’ Joe makes perfect sense.

Bischoff is vice chairman of Citizens Financial Group Inc., whose consumer and business banking unit is responsible for recently opening a Citizens branch in a Dunkin’ Donuts. He believes the mix of the two powerful New England-based brands should prove irresistible to many customers and potential depositors.

“The customers are really after convenience,” Bischoff told Providence Business News last week. “They want to bank when it suits them. [With the Dunkin’ Donuts in-store branch] you can kill two birds with one stone.”

Indeed, Bischoff foresees similar combinations across Citizens’ New England footprint, if the initial experiment in Bellingham, Mass., meets expectations.

But others aren’t so sure it’s a good idea.

Last month’s announcement of the branch opening inside the Dunkin’ Donuts sparked a bit of a buzz among local bankers and had some raising doubts that it would work.

Derek Ferber, senior analyst with SNL Financial in Charlottesville, Va., wasn’t convinced, either.

While Ferber acknowledged that branches in supermarkets and at gas station convenience stores have been a success, bringing a bank to the coffee shop might be taking convenience too far.

“You always have to go to the grocery store; you always have to get gas,” said Ferber, who is preparing to release a report on in-store banks next month. “But you don’t have to go to a coffee shop.”

Bischoff insisted he’s not listening to that chatter. Instead, he has been getting positive feedback from customers since the branch opened last month. “People want a choice,” he said.

This wouldn’t be the first time that Citizens Financial Group Inc. has blazed its own path in setting up branches inside retail locations.

While other institutions were abandoning the strategy several years ago, Citizens was one of several banks to expand its in-store network, buying existing branches or opening new ones in places locally such as Stop & Shop supermarkets.

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