Bank of America Bets $5 Billion on Branches as Rivals Retreat to Digital

Bank of America is doubling down on brick-and-mortar expansion with a $5 billion investment, defying digital-only trends to capitalize on high-touch banking demand.

Defying the industry’s rush toward app-only banking, Bank of America unveiled plans to open 150 new physical branches by 2027—40 of which will launch by year-end—backed by a $5 billion investment in its brick-and-mortar network since 2016. The strategy positions the bank as a contrarian in a sector where competitors like Chase and Capital One are shuttering locations, betting instead that hybrid human-digital service will dominate high-stakes finance. The new branches, branded as “Financial Wellness Centers,” blend automation with personalized advisory services. Features include AI-driven kiosks for routine transactions, video conferencing pods for remote expert consultations, and soundproof “decision rooms” for mortgage or wealth management talks. This design aims to cater to a paradox in customer behavior: while 76% of daily banking happens online, a J.D. Power study notes 61% of clients still insist on in-person guidance for loans or retirement planning.

Bank of America’s pivot also targets market gaps. Over half of the new branches will open in fast-growing Sun Belt suburbs and rural areas, where population surges outpace banking access. The expansion dovetails with tech upgrades: existing locations now use AI tools like Erica, the bank’s virtual assistant, to pre-screen customers’ financial health before they meet advisors. Analysts suggest the move is as much about trust as convenience. “In uncertain economies, physical presence signals stability,” says banking strategist Claudia Rossi. “Combining that with AI efficiency lets BoA cross-sell mortgages or investments during routine visits.”

While fintechs like Chime and neobanks tout digital-first agility, Bank of America’s scale offers a rebuttal. Its branches now average 30% higher foot traffic than in 2019, driven by small businesses and older demographics. Yet risks linger—rising real estate costs and staffing shortages could strain profitability. As digital-only models hit plateaus, BoA’s gamble underscores a reality: in banking, bytes and brick might still be the ultimate power couple.