National City Bank to reward customers: This was a PLAIN DEALER front-page item last Friday:
"...National City last year went on a mission, saying it planned to boost profits by hundreds of millions of dollars a year by increasing revenue and cutting expenses. Profits last year dropped by 29 percent after the bank enjoyed blockbuster years during the refinance boom.
With its points program, National City wants mostly to expand the business it does with existing customers. But the points program is also aimed at attracting new customers, both consumers and small businesses.
National City, one of the 10 largest banks nationwide, declined to say how much the rewards program will cost but said it's expected to be profitable in the second year.... "
"...It used to be open a new account and get a toaster," said Woker, of Morningstar Inc. But rewards like Bose stereos, mountain bikes and restaurant gift cards - all of which National City is offering - are a big step up, he said.
The venture demonstrates the value in getting low-cost or no-cost deposits that the bank can lend to others, he said, and shows how much banks love having customers with multiple accounts. "They'll be locked into your bank potentially for decades," Woker said....
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