Bank of America Corp. could close as many as 10 percent of its branches as it adjusts to changes in how customers conduct banking and works to trim expenses.

Bank of America Corp. could close as many as 10 percent of its branches as it adjusts to changes in how customers conduct banking and works to trim expenses.

"What we are heading to is a model where we have fewer but more robust branches that incorporate the investment and mortgage services that we have picked up with the acquisition of Merrill Lynch and Countrywide," said James Mahoney, a Bank of America spokesman.

People are accessing their money in new ways and have less need for the traditional neighborhood branch, he said.

"We have gone from zero to more than 2.8 million mobile (phone) banking customers in less than two years," Mahoney said.

The Charlotte, N.C., bank has 29 million online customers who conduct more than 3 billion transactions a year. And the percentage of bank deposits that move through its ATM network has jumped from 33 percent to almost 50 percent in the last year.

"Customer behavior is evolving, and we have to evolve accordingly," Mahoney said.

Mahoney said the bank has yet to decide on what individual branches might close and that the transition to a smaller network will take three to five years.

Such a move would represent a retrenchment for the giant bank, which over the last two decades has expanded aggressively, giving it coast-to-coast reach.

Analysts said closing branches would save the bank money and makes strategic sense considering the pressure Bank of America is under to shore up its financial position.

"The fact is that an increasing number of consumers, especially younger ones, and businesses rarely go to branches anyway. By maintaining and growing its mobile and online offerings, BofA should be able to retain such consumers as customers," said Red Gillen, senior analyst with Celent, a Boston-based financial research and consulting firm.

"I expect the bank to place considerably more emphasis on enhancing its mobile and online technology," Gillen said. "Remote deposit capture, person-to-person payments, mobile-based promotions and other new services are now probably a lot closer to the center of BofA's radar screen."

The branch-closure strategy came up in a discussion about the long-term direction of the company between executives and investors at a meeting last week, Mahoney said. It was first reported by The Wall Street Journal.