Canadian Imperial Bank of Commerce is not counting on the Internet alone to propel its expansion into the United States.

Differentiating itself from its closest competitors, the Toronto institution plans to borrow an established brand and some physical locations from a U.S. grocery store chain to bolster its on-line presence here.

CIBC is to open the first of 40 planned supermarket kiosks in Winn-Dixie Stores this fall, according to its filing for a U.S. national bank charter, which was approved by the Office of the Comptroller of the Currency last week. The automated kiosks are to be staffed with part-time customer service representatives whose role will be to train customers on using the telephone, Internet, and automated teller machines to get information.

CIBC National Bank, to be based in Maitland, Fla., plans to label the kiosks Marketplace Bank. Marketplace is a trade name used by Winn-Dixie on its house-brand groceries, pharmacies, dry cleaning facilities, and bakeries.

By aligning with a familiar and trusted local supermarket brand, CIBC reasons, it can forge closer ties to the community, including low- and moderate-income customers, said a bank spokesman. It may establish similar ties to other regional grocery chains throughout the country, according to its OCC filing.

The strategy is an extension of the President's Choice Financial program that CIBC runs in Canada with the supermarket company Loblaw's Inc.

CIBC had 135 kiosks in Loblaw's stores as of May, up from four at the time of the program's launching in February 1998, according to the OCC filing. President's Choice Financial, using Loblaw's private-label brand name, has exceeded projections by all measurable estimates, said a CIBC spokesman.

By making grocery-store pavilions a central feature of its U.S. strategy, CIBC is recognizing that Internet customers often prefer some form of human interaction.

The kiosks would fulfill customer demand for physical locations at an estimated one-fifth the cost of a traditional brick-and-mortar branch, CIBC said in its filing.

The $281 billion-asset bank is following in the footsteps of other Canadian banks entering the U.S. consumer banking market via the Internet, complemented by a limited physical presence.

Royal Bank of Canada's subsidiary, Security First Network Bank, has opened branches in its home city of Atlanta and in Clearwater, Fla.

Bank of Montreal's mbanx, originally conceived as an Internet-only bank, now is being integrated with regular branches in response to requests by users to be able to bank through all channels, according to a bank spokeswoman. Bank of Montreal plans to replicate the multichannel strategy at its U.S. affiliate, Harris Trust and Savings Bank of Chicago.

CIBC's use of supermarkets poses some challenges, observers said. One risk is that many U.S. supermarkets already have banking services available, said Gary Craft, a managing director at E-Offering. In fact, Winn-Dixie already has bank branches in 250 of its 1,180 stores in 14 states and the Bahamas, said a Winn-Dixie spokesman.

John Grace, executive director of New York-based Interbrand, called CIBC's approach "very smart and very dumb."

By using a local name, CIBC is "missing the opportunity to build a world-class brand," he said.

The bank may benefit in the short term from the established brand, he said. But in 10 years, Mr. Grace said, he "cannot imagine" that the Marketplace Bank name will survive against the likes of Citibank.com, Chase.com, and Bank One's new Internet subsidiary, WingspanBank.com.

Mr. Grace instead suggested a nationwide cobranding strategy, which he said would build equity value for the bank as well as its supermarket partners.

The bank's decision to use the Marketplace name in Florida probably arose from research showing unfamiliarity with the CIBC brand, as well as a strong affinity for the Jacksonville, Fla.-based Winn-Dixie chain, Mr. Grace speculated.

The OCC filing said CIBC is investing $425 million in its initial U.S. expansion effort and expects to earn a profit in three years.

It expects to offer competitive rates on loans, deposits, and bill payments. For mortgages, the Web site would link to iOwn.com, an on-line mortgage broker. The bank may seek to cobrand its credit cards with a third party.

Pending regulatory approval, CIBC plans to open the first of its supermarket branches in the Orlando area. Kiosks eventually will be deployed throughout Winn-Dixie's 426 Florida stores and then in other states.

CIBC plans to rely on outsourcing for Marketplace Bank's Internet platform, item processing, core data processing, bill payment services, delinquent loan collection, card and check production, and statement issuance. A bank spokeswoman declined to comment on decisions about service providers.

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