New Jersey's Hudson United Bancorp is betting that modern furnishings, self-service kiosks, and magazine reading areas will draw customers to its branches.

The $7 billion-asset company unveiled a prototype branch Monday in its hometown of Mahwah. It is the first of 166 branches the company is revamping as part of a multimillion-dollar campaign to make them more inviting and customer-friendly.

"We compete in markets with many large banks that have been trying to drive traffic out of the branches," said Susan Staudmyer, executive vice president of retail banking, who is spearheading the project. "Our focus is to provide a high level of touch."

The branches, or stores, will feature Internet terminals, magazine racks with business periodicals, and self-service areas where customers can check the status of their accounts. Reference materials will be available for prospective investors.

Hudson United, parent company of Hudson United Bank, plans to renovate its branches in New Jersey, Connecticut, and New York during the coming year.

The new look, which has been on the drawing board for nine months, is designed to give employees the opportunity to cross-sell products. Instead of sitting behind teller windows, bank employees will roam the branch as they would at a retail store.

Homebuyers will also be able to do their own underwriting exercise at a terminal to determine whether they would qualify for a mortgage.

"Our research tells us that customers respond very positively to self- help features, things that make them feel more in control," Ms. Staudmyer said. "We are offering them the ability to glean information on their own."

Hudson United is not the first bank to try to turn branches into "stores."

Wells Fargo & Co. remodeled selected branches during the '90s, and Oregon's South Umpqua Bank gained national attention a few years ago for including computer cafes, coffee bars, and post office services in its branches.

But Hudson United's new design, created by John Ryan Co. of Minneapolis, could be the largest rollout of such a consumer-friendly style.

Ms. Staudmyer declined to say how much the makeover will cost, saying that an accurate figure has not been determined. When South Umpqua designed its prototype branch in 1996, it said it had spent $650,000. Ms. Staudmyer said that figure was "in the ballpark" for Hudson United's first branch.

Analysts have not yet been briefed on the redesign. But John Kline of Sandler, O'Neill & Partners in New York said the idea could serve the company well if it can boost internal growth. "If you can tailor the product to meet the customer, it's bound to generate more revenues," he said.

The first new branch officially opens May 22, with nine others in northern New Jersey scheduled to follow shortly.

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