Our cover story looks at the phenomenal success Memphis' National Commerce Bancorp. has had since it began opening supermarket branches a decade ago. But while in-store branches have emerged as a key retail delivery strategy, it's only one way that banks are trying to get more out of brick and mortar. In March, for example, KeyCorp unveiled an office targeted to small- business customers. Bankers working at the 4,700-square-foot facility specialize in small-business lending. New technology in the facility includes kiosks that dispense information to customers. The Columbus, Ohio, branch is called a KeyCenter. The bank is also designing facilities that will cater to three other customer segments mature, emerging affluent, and the mass market. In addition to Columbus, prototypes will be opened in Seattle and Syracuse, N.Y. After gauging customer acceptance, KeyCorp expects to roll out more of the specialized branches across its 13-state network later this year. In recent months, Pittsburgh-based Mellon Bank Corp. has also begun to transform its branch network. But unlike KeyCorp, Mellon is opening what it calls one-stop financial services offices to provide both consumer and small businesses with a broad range of products. Mellon wants to implement the model in every retail market by 1997. In the Philadelphia area, for example, Mellon will operate seven such offices and consolidate seven other traditional branches. Both KeyCorp and Mellon also offer remote retail delivery channels, such as telephone banking. Mellon also plans to open new supermarket branches. The banks that are looking ahead talk in terms in terms of distribution points, said Douglas W. Ferris Jr., president of National Commerce Bank Services. I think you talk in terms of how does the consumer or small business want to bank? And we are going to have multiple points of distribution.

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