Once again, bricks and mortar showed surprising strength with a net gain of 1,432 branches in 1998. With 74,408 total branches, the U.S. has one bank branch for every 1,350 households.  The total number of banks and thrifts entities declined by 462 to 10,461. Interest in new charters continued its upward trend with 222 issued in 1998, 22 more than in 1997, and the highest single-year total since 1988. But, branches share of transaction volume has been falling, from 54% in 1994 to 40% in 1999. The telephone channel has picked up most of this growing its share from 12% to 22%. Online accounted for just 2% of transaction volume in 1999 (Table 3).

 

Table 1

Number of Bank and Thrifts Operating at Year-End (U.S.)

Source: FDIC, 12/99                 *Total new bank and thrift charters; in 1998, 194 were new banks, 28 were new thrifts

 

Table 2

Retail Delivery Channel Usage (U.S.)

Metric	1999
U.S. HHs that own a PC	50%
U.S. HHs that have access to the Internet	33%
Consumers aware of home banking	66%
Total retail banking transactions*	32 billion
Number by ATM/Phone/PC	16 billion
U.S. HH using online banking	7%
Average transactions over all channels	15/mo
Average number online transactions	12.4/mo
Average branch transactions	7/mo

Source: PSI nationwide study of responses from 3,217 U.S. HHs, Dec ’99.
* Transactions are any info exchange initiated by a consumer including cash withdrawals, deposits, account inquiries, investment trades, funds transfers, statement requests, product/rate information requests, new account sales, stop payments, and problem resolution.

Table 3

Transaction Volume by Channel (U.S.)

Channel	1994	1999	Change		CAGR
			Points	%
Branch	54%	40%	(14%)	(26%)	(5.8%)
In-store	2%	3%	1%	50%	8.5%
ATMs	22%	24%	2%	9%	1.8%
PC	--	2%	n/a	n/a	n/a
Mall	5%	3%	(2%)	(40%)	(9.7%)
Telephone	12%	22%	10%	83%	13%
Other	5%	3%	(2%)	(40%)	(9.7%)
Total	100%	100%	n/a	n/a	n/a

Source: PSI 12/99 (see footnote on Table 3)

 

Table 4

Channel Usage: Online Bankers vs. Offline Bankers

percent of customers using each channel

Source: Cyber Dialogue, DMDNY 2000 Presentation, 5/24/00, www.cyberdialogue.com from interviews of 12,000 consumers each quarter

¹Customers currently USING online banking

²Customers currently NOT USING online banking

³Customers comfortable with phone banking are likely candidates for online banking

Table 5

Transactions: Online Bankers vs. Offline Bankers

percent of customers using each channel

Source: Cyber Dialogue, DMDNY 2000 Presentation, 5/24/00, www.cyberdialogue.com from interviews of 12,000 consumers each quarter

¹Customers currently USING online banking

²Customers currently NOT USING online banking