Why are banks opening more physical branches in the digital age?

Banks do not unilaterally just expand branches. It is (in every bank) a calculated investment/decision.

Before a branch opens up, a bank does survey on the geographic location and some of the questions / points looked at are:

• Competition (number of branches)
• Distance to the nearest branch
• Potential Deposit Base
• Foot traffic
• Vehicle Traffic
• Business Traffic
• Type of banking potential here
• Residential areas
• Upcoming Residential, Business and Commercial construction
• Queue lines in other banks or existing branches
• Workload of the existing branches for non-cash transactions
• Market penetration
• Long term viability of the branch (can your products essentially force the other branches to close down? Will the upcoming apartments blocks increase banking in the area?, etc.)
• Midway consolidation (open a new branch 'mid' point between 2 or even 3 existing branches) and then close the other 2-3 branches.