AAA has just opened its first bank, located next to its AAA auto club facility in Omaha, Nebraska. Initial capital of $50 million was provided for this venture, placing the bank in the top 15 of the 222 banks in the state.
Though this bank has enough capital to support $300 million or more in future loans, it is starting small, offering just a few loans and deposits.
AAA is following in the footsteps of Mutual of Omaha, which grew its Nebraska bank from nothing in 2007 to assets currently worth $5 billion. This bank has a potential customer base of AAA members and a brand that enables its Internet bank to be recognized nationwide.
The plan is to be a community bank, opening three to five new offices in Omaha over the next two years.
The bank will provide business and commercial lending but no large corporate financing or national lending, reports CEO Bart Qualsett. Experienced and well-known bankers will provide personal service to customers in the Omaha area.
The hope is that people will opt for AAA bank financing rather than expensive payday loans or credit card cash advances.
AAA selected Omaha for its first bank partially due to the success of its call center located within the city. The bank is part of Auto Club Trust, whose owner is the AAA Auto Club Group that operates AAA clubs within eight states in the Midwestern U.S., Nebraska included. Auto Club Trust was started by AAA in 1999.
Omaha has a relatively good economy, low rate of unemployment, and stable housing market that make it suitable for a full-service bank. Few new banks have opened recently due to uncertainty regarding the economy and higher financial requirements imposed by federal regulators.
Only one new bank has been granted a charter this year.
