Nearly a year ago, Superstorm Sandy brought a Hudson River tidal surge through the front door of a Chase Bank branch at the foot of a steep hill in Edgewater, N.J.

Nearly a year ago, Superstorm Sandy brought a Hudson River tidal surge through the front door of a Chase Bank branch at the foot of a steep hill in Edgewater, N.J.

A boat from the marina across the street drifted across the parking lot and crashed into the bank’s north wall. Runoff from the driving rain found its way through a back door by an elevated drive-thru lane and cascaded into the lobby. Furnishings, flooring and even safe-deposit boxes were ruined.

That was then.

Today, no signs remain of the destruction, and the branch, which reopened in April, has been reborn as a showcase for design innovations that Chase has been rolling out in the past year, the company said.

“Hurricane Sandy, although unfortunate, gave us the opportunity to rebuild and be able to leverage our new design,” said Brad Nolan, Chase’s head of design for retail branch and ATM innovations.

The changes include the addition of a private-client area with two offices, more cubicles for specialist bankers who open accounts and sell securities, mortgages and small-business loans, and fewer teller stations — three instead of five.

Among the new, behind-the-scenes features are currency-counting machines that speed cash deposits at the teller counter and relieve stress for staff, who no longer have to count money by hand.

The design changes and technology improvements made at this particular branch office point to more striking innovations to come in bank design as the biggest national lenders adjust to a steady decline in foot traffic and changing customer preferences, while looking to hold down long-term labor and real estate costs.

So get ready for smaller branches with fewer tellers and more skillful ATMs.

For years, most people have been direct-depositing their paychecks, and more recently, bank customers have been increasingly turning to online and mobile banking, giving tellers less and less to do.

Meanwhile, bankers have been busy selling loans, credit cards and other financial products and services to their deposit customers in the branches.

These developments are reflected in the new branch designs, some of which have much smaller floor plans and no teller counters at all.

Instead, they offer concierge-like greeters and new-generation automated teller machines with check-imaging capability that can handle withdrawals and deposits, accept credit-card and loan payments, and cash checks. Typically, they also have private areas where bankers can help customers open accounts or apply for loans and deal with questions and problems.

Since Chase rolled out ATMs with check-imaging capability a few years ago — making it so that deposit slips and envelopes are no longer needed to make deposits — the percentage of deposits made at ATMs has increased to nearly 50 percent of the total from 11 percent, Nolan said.

The newest ATMs offered by Bank of America in its “express” branches take ATM functionality a step further, offering video conferencing with live tellers. Bank of America and Wells Fargo have opened branches with floor plans half the size of their standard branches.

The move toward smaller, self-service-oriented branches is driven in part by economic pressures on banks and by the increased popularity of online and mobile banking, according to industry experts.

Branches are still needed — just not as much, they say.

Banks that offer service options that are fast, convenient and linked to customers’ smartphones, will be the ones most likely to deepen relationships with their account holders and foster customer loyalty and cross-selling opportunities, industry professionals say.

“There is an increasing appetite for experimentation,” said Ed O’Brien, director of the banking channels advisory service at Mercator Advisory Group in Maynard, Mass.

“Larger banks, especially, are experimenting with a hub-and-spoke strategy, with traditional branches and maybe a large flagship branch with wealth management services, and small branches with ATMs and personnel walking around with computer tablets,” O’Brien said.

The shrinking of teller lines has been hard for bankers to ignore, according to John McWeeney, president of the New Jersey Bankers Association.

“In New Jersey and across the country, the level of transaction activity in the branch is declining pretty steadily,” McWeeney said. “There are fewer teller stations and, frankly, fewer tellers, mostly because customer preferences have changed.”

An American Bankers Association survey released last week showed the Internet remains the most popular banking method for a fourth year in a row, with 39 percent favoring that method to manage their accounts, while 18 percent favored visiting a branch, down from 25 percent in 2010. Mobile banking was favored by 6 percent of customers, up from 3 percent in 2010. Among millennials, those 18 to 34 years old, mobile banking was preferred by 15 percent.

The trend is reflected in government statistics that show a decrease in the number of branches. In the United States, there were 96,341 branches as of June 30, down from 97,340 a year earlier, the fourth straight year of declines.


The biggest banks are leading the way in going small, when it comes to branch design.

Bank of America said it is experimenting with a much smaller floor plan and no teller counters.

Its express branches, including one that opened last month at 95 Wall St. in Manhattan, offer so-called Teller Assist ATMs, which allow customers to video-conference with a teller sitting in Florida or Delaware, said a spokesman, T.J. Crawford.

With 2,200 square feet of space, the express branch is about half the size of a traditional Bank of America branch.

Teller Assist ATMs are accessible from 7 a.m. until 10 p.m. during the week, and there is no fee for the service, said Crawford.

A bank’s cost of conducting a traditional transaction through a teller is about $3 to $4, according to O’Brien from Mercator. The cost drops to less than $1 for an ATM transaction, or less than 30 cents for ATMs that handle a relatively large number of transactions, he said.

“The need for fees, at least in the near term, is probably not there,” O’Brien said, as long as the volume is sufficient to offset the cost of upgrading machines.

Chase’s Nolan said that company expects to open a branch in Manhattan later this month that will have bankers at work stations similar to stand-up cafe tables, in addition to a few teller stations.

The office’s higher-functioning ATMs will dispense cash in all denominations and coins, too.

“They can take out $19.01 if they want,” Nolan said.

The bank is working on adding check-cashing capability and the ability to swipe on an Android phone in lieu of a debit card and PIN to log into the system.

Wells Fargo opened an experimental branch in Washington, D.C., in April with a 1,000-square-foot floor plan.

The Neighborhood Branch is staffed with four or five employees, instead of the typical eight to 12, and has moving wall sections behind the ATMs that are retracted during business hours and closed afterward, thus allowing 24-hour access to the ATMs, said a company spokesman, Kevin Friedlander.

Customers are met by a greeter carrying a computer tablet who can direct them to an ATM or a private space to talk to a specialist.


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