Domestic banks on the power of Wal-Mart’s appeal

Citizens Bank is well known across the country for putting branches in supermarkets to attract new customers and provide convenience to existing ones.
But on a much smaller scale, Domestic Bank, a family-owned community bank based in Cranston, is successfully using the same approach, growing to seven branches so far with only one site in a traditional setting – all the rest are inside stores.
Domestic has branches inside the Shaw’s Supermarkets in Woonsocket and Johnston, and in 2002, it began placing branches in Wal-Mart stores, starting with the one in the Warwick Mall and then adding sites in North Kingstown and Raynham, Mass.
When Wal-Mart opened its first store in Providence on Jan. 22, at the intersection of Charles and Silver Spring streets, it included yet another Domestic branch.
In addition, the bank plans to open branches in March inside Wal-Mart stores in Coventry and Northbridge, Mass.
Craig A. Baker, executive vice president of Domestic, said the bank plans to continue its strategy of reaching new customers by expanding its branch network in retail settings.
Opening branches in Wal-Mart gives Domestic an opportunity to market its services and products to tens of thousands of people who shop at the store weekly, and win new business at a time when more and more people do their banking via the Internet or at ATM machines, he said.
“Wal-Mart is a wonderful partner for us,” Baker said. “There are, on any given week, somewhere between 25,000 and 40,000 people walking through their stores.”
Domestic hopes to win new business at its Wal-Mart branches by impressing customers with the bank’s focus on customer service, he said. Employees staffing the branches are trained to warmly greet Wal-Mart shoppers and anticipate their banking needs, Baker said.
“Customer service is really our driving force, and what we really try to do is offer service excellence to anybody and everybody walking through a Wal-Mart store,” he said.
The 41-year-old bank, which opened its first retail banking office in 2002, has grown to nearly $300 million in assets and about $230 million in deposits. It now employs more than 200 people and expects to add 30 to 40 more over the next three to five years.
The bank also has made a special effort to build relationships and win customers in the immigrant Latino community, particularly in South Providence. Last year, Domestic partnered with the Greater Providence Merchants Association, a group of Latino business owners primarily from South Providence, to sponsor a series of financial literacy classes in the neighborhood.
Domestic has worked to increase its commercial lending in South Providence by attending local merchant meetings and visiting individual businesses. Domestic’s Web site is written in both Spanish and English.
The bank also is seeking a location for a new branch in the neighborhood, probably on Broad Street, Baker said.
Domestic’s desire to make inroads with the city’s Latinos is a reflection of the community’s growing economic clout. The number of Latinos in Rhode Island has more than doubled in the past decade – growing to more than 90,000 by 2000, according to the U.S. Census Bureau. At the same time, the number of Latino-owned businesses has sharply increased.
Domestic has sought to capture this growing market by offering loans to commercial customers with poor or limited credit histories who fail to qualify for traditional loans.
“This is a growing market, and obviously we think there is a tremendous upside for us,” Baker said.

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