This is exactly what happened but I assumed that the real cause of more branches was different. When banks stopped having to keep banking and investments separa

This is exactly what happened but I assumed that the real cause of more branches was different. When banks stopped having to keep banking and investments separate, they wanted all the customers they could get. When you are averaging 10+% in the stock market while only paying 1% to consumers, you want as many consumers as possible. Then the only reason people would switch would be if a specific branch was more convenient for them or had more free ATMs. This became a question of customer acquisition. Plus you can write off the building and have a solid real estate business (ala McDonalds) for free. This also is what has pushed the banking consolidation trends so much. Banks could no longer get new customers via switching so they starting buying all the local players to keep their balance sheets growing.