Good luck getting a safe-deposit box.
Longtime deposit-box renters are getting kicked out of their boxes by banks that are shutting down or scaling back the service. Customers say they have been struggling to find the small boxes traditionally kept inside vaults to store family heirlooms and other valuables.
Kris Wall called 13 branches around the San Francisco Bay Area over the past 18 months, and visited another six or seven, in her unsuccessful search for new boxes. The 49-year-old gemologist and jeweler uses them to store her work, but was told to vacate her extra-large box at a First Republic branch last year.
A decade ago, she got on a wait list at one bank that said it expected an opening in nine years. It never called. She recently learned the bank got rid of deposit boxes completely.
“It’s literally going the way of landlines,” Wall says.
To some banks, the boxes are becoming more trouble than they are worth. Banks say the service is an anachronism in a time when people increasingly manage their checking accounts and investments on apps and websites.
There are more convenient options to store valuables: A search for home safes on Amazon yields hundreds of results. Home security has gotten more advanced and burglaries have trended down over the past two decades.
Yet safe-deposit box customers—who tend to be affluent and middle-aged or older—see them as a bread-and-butter bank service. They stash important paper documents in them, such as the title to a house or car, as well as family heirlooms like jewelry and coin collections.
JPMorgan Chase, the nation’s largest bank, said in late 2021 that it would stop offering new boxes to customers—and existing renters would lose theirs if their branch closed. JPMorgan became the owner of First Republic last year after it was seized by regulators. It eventually closed all the deposit boxes when it began renovating and rebranding the branches.
Some 48% of Chase branches have safe-deposit boxes. But there are no boxes in the new branches opening, so that share is likely to shrink.
“When we talk to our clients and ask them why they are visiting the branch, it’s generally because they want to speak with someone, or apply for a mortgage or car loan or get investment advice,” says Jerry Dubrowski, a JPMorgan spokesman.
Santander Bank stopped selling boxes altogether early last year, saying they were under-utilized. Capital One stopped renting new boxes in 2017. PNC Bank said last week that it would open 100 new branches, but none will have safe-deposit boxes.
Even banks that are committed to this service are closing branches, and have fewer boxes to offer. Wells Fargo, which has closed roughly 1,200 branches over the past five years, says it offers boxes in the “vast majority” of its branches.
There is no official tally of boxes, and estimates vary. Jerry Pluard, co-founder of Safe Deposit Box Insurance Coverage, says there are about 20% fewer than the 40 million safe-deposit boxes that existed six years ago.
The boxes are essentially tiny gym lockers in a heavily secure location. They usually require a key held by the owner and a key held by the bank to open. The contents, unlike bank deposits, get no special protections from the bank or federal government. Customers must buy their own insurance.
Banks don’t make much profit on them. The 3-inch tall by 5-inch wide boxes can rent for as little as $15 a year. Ten-by-10-inch boxes might go for more than $250 a year, says Dave McGuinn, president of Safe Deposit Specialists, which trains and consults with banks and credit unions about proper box operations.
The boxes can make customers more likely to keep their money at the bank, and sign up for other banking services. “A safe-deposit box is the hardest account you can close,” McGuinn says.
He says that a credit union where he banked recently told him he had to close his deposit box. When he did, he closed out his other accounts there, too.
Some banks say a smaller share of their deposit boxes are rented out these days. But many people still want boxes, Pluard says. He has noticed more people looking for boxes to store precious metals, which have become popular during this year’s surge in gold prices. The customers buying gold bars at stores like Costco need somewhere to keep them.
All sorts of unusual items end up in boxes, and banks never know what to expect when they have to get into them. Among the things McGuinn said have been found are baby teeth, false teeth, an umbilical cord, drugs, a stack of Playboy magazines, deer legs wrapped in butcher paper, antique firearms and three sticks of explosives that required a bomb squad to be called.
As banks get out of this business, some independent companies sense an opportunity. BlueVault operates two private vaults in California with safe-deposit boxes. It is planning to open locations in Texas and Arizona. Jon Sandhaus, who runs the company, says that about a quarter of the people who open boxes do it because their banks don’t have any available. “We get calls daily: ‘They’re shutting down my branch,’” he says.
Zeeshan Aziz says that when a Chase branch notified his family that it was closing their deposit box last year, he went on a hunt for a new one. He called five big banks, then started visiting local credit unions and banks near his home on New York’s Long Island. No one had an available box and no one knew who did. He has since given up the search.
“Not that I’m expecting Jamie Dimon to give us a call,” said Aziz, referring to JPMorgan Chase’s CEO. “You would have thought some arm of the bank would have helped us.”
Write to Ben Eisen at ben.eisen@wsj.com and Shara Tibken at shara.tibken@wsj.com
