Despite the explosion of interest in the Internet and on-line banking, consumers still want and use traditional branches, a survey by KPMG Peat Marwick and Yankelovich Partners Inc. indicates.

Of 1,000 consumers surveyed in September, 73% said they preferred to bank in person at a branch. Only 22% said they wanted to bank exclusively by electronic means.

A separate group of avid personal computer users identified as "cybercitizens" also retained a preference for branch banking. Of those, 91% said they had security concerns about banking on-line, and 73% said electronic mail was no substitute for personal interaction.

The research tends to reinforce the increasingly accepted notion that brick-and-mortar offices need to be retooled rather than eliminated and will not soon be displaced by electronic alternatives. Studies by Payment Systems Inc. and individual bank marketers, for example, have shown that many heavy users of electronics also frequent branches.

Branches "are alive and well and still kicking," said Charlotte Wingfield, a San Diego-based KPMG financial institutions partner. "Banking in person ranks first on the list in terms of desirability." Even the cybercitizens are drawn to its availability and dependability.

Ms. Wingfield's presentation of the KPMG-Yankelovich data and defense of the branch contrasted with the otherwise boundless Internet enthusiasm that prevailed at the American Banker cyberspace banking conference this week.

Typical of the converted, Wells Fargo Bank executive vice president Dudley Nigg argued that Internet banking is attractive because "that is where the customers will be, and where many already are" and because of marginal delivery costs far lower than on any other delivery system.

Mr. Nigg noted 55% of Wells customers have home PCs, almost 20 percentage points above the national average.

The KPMG study - discussed by Ms. Wingfield for the first time and to be published in stages over several months - showed not only that bricks and mortar are dearer to consumers than on-line enthusiasts might have assumed, but that the "mature" automated teller machine is still growing by 10% a year in transaction volume.

Also, 64% in the survey said they would rather not use technology at all for certain financial transactions. That cut across demographic categories: College graduates were only marginally more receptive than others to PC and Internet banking.

The so-called cybercitizens had much in common with the "average" consumers. They were virtually equal in their desire for control over their financial lives, preference for a single institution to handle all their needs, and valuing financial advice from bankers over other professionals.

They expressed concern about privacy and liked the personal touch. "Most consumers see technology as inevitable," Ms. Wingfield said. "They are resigned to it. They weren't that enthusiastic or receptive to it."

To rejuvenate branches, Ms. Wingfield suggested bankers learn from the way the movie industry made theaters more appealing to fend off the threat of video rentals and cable television.

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