'U' may not renew National City deal

The green and white signs of National City Bank may no longer be the most accommodating to University students on this maize and blue campus, when the bank's five-year contract with the University expires June 2000.

Although National City is the University's primary bank, University administrators have been considering giving its banking business to other financial institutions.

"Nothing has been ruled out at this point. National City has been good to work with, but there's a chance that we wouldn't resign another contract," said David Doyle, the University's coordinator of marketing and sales for the Department of Financial Operations.

In selecting a bank, Doyle said the University considers the quality of service a top priority. "We want to know what the different banks can provide to the students, faculty and staff and look for services that are most beneficial to the University's needs."

But like most contracts between the University and the private sector, Doyle said a bidding process helps determine the University's choice. He said the financial operations department currently is analyzing different bids for the new contract, and like the last process, the bids are highly competitive.

Doyle said the University will ultimately sign with the bank that provides the best combination of service and a high bid.

The University's initial contract was made with First of America, but National City has since purchased the company. Doyle said changes in ownership have affected both sides of the banking business.

"When we first started out with First of America, we were pretty happy because they were an outgoing bank and reached out to students. National City wasn't really into the campus environment, so it was something that they had to grow into. It was a new experience for them and for us," Doyle said.

Even though the change in ownership occurred in November 1998, recent policy changes in National City accounts have affected student's banking methods.

On Oct. 1, the self-serve checking account replaced First of America's campus first account, the common checking account for students. Under this plan, all transactions must be made at an automatic teller machine or the customer is subject to a $3 service charge in addition to an initial $3 monthly fee, explained Peg Caldwell, manager of the National City branches on South University Avenue and East Liberty Street.

"We found that statistically, students use the ATM more than anything, so this is a way to cut down service fees," Caldwell said.

In response to alleged student complaints about this new type of account, the Michigan Student Assembly has formed a joint declaration with the Western Student Association, the student government of Western Michigan University, to make banking policies more "student friendly." WMU has a similar contract with National City that ends at about the same time as the University's contract.

"We are trying to support each other to get the best banking options for all our students," WSA Finance and Budget Chair Chad True said about the declaration.

"It's as if they have railroaded students into this option, and it seems to be one of the worst on campus," said Rackham student Suzanne Owen, MSA treasurer.

Owen said that formalizing the relationship between MSA and WSA is the first step in changing the contract with National City.

"My plan is to talk to administrators in the MCard office to see what changes can be made to current banking policies, especially in reducing fees for student accounts," Owen said.

Doyle said the department of financial operations has not talked to MSA representatives yet, but it will try to get MSA's input before finalizing the contract. "We ask them different questions on how policies would affect students," he said.

Owen hopes that in the researching the new contract, the administration seeks primarily to serve the students and not simply opt for the highest bidder. She added that other financial institutions on campus have checking account options that do not incorporate any service fees, such as Great Lakes National Bank and the University of Michigan Credit Union.

Seema Malhotra, manager of the GLNB branch located on East Liberty Street said students are very critical clientele for the bank.

"We offer a variety of accounts, including a student checking account. We also give a premium for anybody who opens an account here," she said.

While Doyle noted that these banks are "definitely interesting prospects," they are not always viable. "There are other factors that are very important to students, such as how many branches are close to campus and how many ATMs are available. Plus, we do not get a bid from every single bank, so even if such a bank offers great services, then they are just not an option," he said.

GLNB Marketing Development Manager Ray Black said GLNB decided not to bid for the new contract. "It was not opportunistic for us," Black said.

UMCU Marketing Director Mary Dahlky also said the credit union is not bidding to fill National City's shoes.

Doyle added, "we're trying to please a majority of people, and that's difficult to do."

10-20-99