Solera National Bank in Lakewood, Colo., is hoping it can serve predominantly Hispanic consumers and businesses without having to broaden its focus.
To do that, the $48.6 million-asset Solera, which opened in September, has announced at least five partnerships over the last three months with established businesses, nonprofits, and even another bank to offer products, services, and financial literacy programs to Solera's customers. It has one branch in a Hispanic community, and it plans to open at least four more in similar communities from Boulder to south Denver in the next several years.
The aim is to use these arrangements not only to attract Hispanics new to banking by offering remittances and check cashing, but also to win established customers from other banks by offering mortgages and business loans, according to Paul Ferguson, Solera's chief executive.
"We're partnering with very popular entities in the Hispanic community here, which will help us reach more consumers as well as small businesses," Mr. Ferguson said in an interview Wednesday.
One of the partnerships is with Countrywide Financial Corp., which began offering home loans to Solera customers in its lone branch in June. Bank of America Corp. acquired Countrywide last month, and Mr. Ferguson said it is unclear if the partnership will continue, but so far he has been pleased with the foot traffic it has generated.
Working with Countrywide "has created increased lobby activity and the opening of deposit relationships," he said.
In addition, an Allstate Insurance Co. agent has set up shop in Solera's branch to sell policies to its customers.
The bank is reaching out to the Hispanic market through a range of other deals. It is offering remittances through an arrangement with MoneyGram International Inc. and other vendors. It has become the preferred lender to minority contractors who are members of the Rocky Mountain Minority Supplier Development Council. It is working with a number of nonprofits to establish financial literacy programs, and it announced that it is holding deposits for the Latin American Educational Foundation in Denver, which will work with Solera to establish scholarship funds for Hispanic college students.
Other start-ups that are targeting Hispanics, particularly unbanked ones, have found that their focus is too narrow to be profitable, and they are trying to broaden their appeal.
Solera will also court mainstream customers, but Mr. Ferguson said he believes it can maintain its focus on Hispanics by making a concerted effort to attract those who have established banking relationships. It considers its target market to be second- and third-generation Hispanics, many of whom have banking relationships and might own their own businesses.
"The success our business plan and model is not contingent on quickly converting the unbanked — although this represents a very large future potential opportunity we plan on taking advantage of," Mr. Ferguson said.
He expects Solera's shareholders to drum up business as well. It was capitalized with $25.6 million from 800 mostly local investors, many of whom are Hispanic business owners, Mr. Ferguson said.
Larry Martin, the president of the Denver consulting firm Bank Strategies LLC, said he believes that the bank can become profitable fairly quickly by making good use of its shareholder base.
The partnerships it has established could help it steal customers away from large banks that have groups dedicated to serving Hispanic communities, Mr. Martin said.
"These partnerships will give Solera a terrific amount of exposure, without having to do a lot of very expensive broadcast or print media advertising, and I think it will pay huge dividends for them," he said.
Mr. Ferguson said that the partnerships — particularly its arrangement with the minority contractors' council — have already generated a growing pipeline of leads for deposit and loan customers.
Mark Harrison, the president of Business Consortium Fund Inc., a New York nonprofit that provides loan guarantees and participates in loans to members of such councils, said most institutions that work with his organization are regional banks that want to attract more minority businesses or community development financial institutions.
Solera is the only bank in Colorado participating in the loan program, Mr. Harrison said. As such, it will have "a greater chance attracting minority contractors in need of capital as opposed to other banks there."
