Contrary to conventional wisdom, the number of bank branches in the United States is continuing to rise.

Between 1985 and yearend 1994, the number of commercial bank and trust bank branches jumped 27%, to 55,145, according to Federal Deposit Insurance Corp. data.

Analysts and regulators said part of the increase can be attributed to the acquisition of thrifts by banks.

But, they added, thrift acquisitions do not account for the total increase in commercial bank branches.

Instead, said Don Inscoe, head of statistics for the FDIC's research division, bankers see important benefits to maintaining branches.

"All the discussion about the disappearance of brick and mortar is not supported by numbers today," he said.

Between 1993 and 1994, for example, the number of branches at savings insitutions insured by the FDIC declined by 684, to 14,927. But, at the same time, the number of bank branches increased by 2,023.

Analysts interviewed expressed surprise that the number of commercial bank branches had not declined between 1985 and 1994 despite a sharp reduction in the number of banks - from 14,417 to 10,451.

During the same period, there was also the reported closing of hundreds of branches by big banks like BankAmerica Corp. and Chemical Banking Corp. following major acquisitions.

Observers noted that the increase in the number of bank branches flies in the face of oft-repeated predictions about technology and electronic banking, which were supposed to eliminate the need for physical offices.

"Banks have discovered there is value in having service points that go beyond conventional wisdom," remarked Andre Cappon, president of the CBM Group Inc., which is conducting a study on the strategic value of branches. "Branch banking is far from dead."

Analysts ticked off several reasons for the survival of branch networks, including:

*The inability so far to introduce a consumer debit card for small- ticket purchases.

*The continued need among small businesses for nearby bank branches.

*Real estate development and population shifts.

*Banks' own efforts to use branches to market a broader range of products, such as mutual funds.

Analysts also noted that branches still remain the best point for collecting low-cost retail deposits and valuable information about customers that can be used for marketing purposes.

Closing branches in a market as competitive and fragmented as the United States, they added, is far more difficult than in places like Europe, where banking has been highly concentrated and markets are smaller. They also pointed out that assessing a branch's profitability and deciding which branches to close or retain remains difficult.

"The measurement of branch performance is imperfect, highly skewed, and driven by a variety of factors, including location, branch size, and business mix," said Mr. Cappon. "Branches also grow very slowly and have an important 'network' value."

"The economics of branch closure are actually quite tricky," says John Eric Bigbie, director at Braxton Associates Ltd., a London- based unit of Deloitte Touche Tohmatsu International. "If you lose 5% of your customers when you close a branch and it's the wrong 5%, you can blow up the economics of the operation."

Still, no one disagrees that the shape of bank branches will change radically in the future. Analysts also predicted that banks like Wells Fargo & Co., which is planning to shut down one third of its traditional 630 branches and replace them with hundreds of minibranches and supermarket offices, could well be the model for the future.

"Your traditional marble palace is going to be a thing of the past," predicted Lawrence W. Cohn, a banking analyst with PaineWebber Inc. "It's clear that consumers desire convenience but it's also clear they don't care whether they bank in a traditional branch or at a grocery store, so long as they can transact their business."

Although everyone agrees that the number of bank branches will inevitably diminish as electronic payments become more widespread, no one appears to be quite sure when this will happen.

"It'll happen, but it will be slightly further in the future than people predict.

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