Banks expand clientele, open new branches -- in elementary schools

April 17, 1994|By Jim Mitchell | Jim Mitchell,Dallas Morning News

DALLAS -- It's 8 a.m., hardly the hour most folks would eagerly stand in a bank line.

But for Sarah Conant and other fourth-graders at Robert Hyer Elementary School in Highland Park, Texas, it's never too early to start saving, especially if the bank comes to you.

Quietly waiting her turn behind a line of 9- and 10-year-old classmates, Sarah, 10, watches intently as a Bank One teller in the school cafeteria hands her a receipt for a $10 deposit. The deposit brings her savings account balance to $173.55, the hard-earned fruits of chores around the house and of her lemonade business.

"You don't have to go to the bank, just bring it to school," said Sarah, who says she's saving for a rainy day. "And my dad likes it because he doesn't have to take me to the big bank."

Others, such as Travis Griffin, 10, have more immediate concerns and goals. "You know that your money's not going to get stolen," said the fourth-grader, who's saving for accessories to his video game system.

These days, banks are reacquainting themselves with their preteen customers after years of virtually ignoring children under 12 in favor of large commercial accounts and revenue-generating adult accounts. Although preteen accounts are small -- on average around $500 -- banks are realizing that it's time to look for future customers.

A lot is at stake. Preteens have more money today than at any other time in history. Surveys in 1989 and 1991 by Texas A&M University show that children between ages 4 and 12 are saving more cash in savings accounts and spending less on video games and other playthings. As a group, preteens controlled about $14.4 billion in 1991, up from $8.9 billion in 1989.

While most financial institutions still don't track preteen and teen accounts separately, those that do, offer an insight as to how the market is growing.

Statewide, Bank United says it has about $3.1 million in 5,484 accounts held by customers under 16 years old. Texas Commerce has collected about $1.3 million from 20,363 participating students at 67 schools statewide, and Bank of America, which entered the Texas market about three years ago, has more than 4,442 youth savings accounts statewide with an average balance of $858.

However, the most visible bank marketing and educational efforts are the mock banks that many institutions set up in various elementary schools in North Texas.

Like youth accounts at local branches, most of these accounts don't charge fees, require minimum balances or limit withdrawals. Through such programs, children learn how to make a deposit, the meaning of savings and interest and how a bank works.

"Banks need to be more accessible to the community," said Lawrence F. Hysinger, a Texas Commerce executive vice president who oversees the bank's branches.

Bank of America's Texas operation also urges employees to spend time mentoring students about finance and encourages savings programs at neighborhood schools.

At the Janie Stark Elementary School in the Carrollton-Farmers Branch Independent School District, kindergarten through fifth-grade students stream into the Stallion Savings Bank each Thursday morning. The classroom banking center is run by parent volunteers and a nearby Texas Commerce branch.

Since it began in October 1992, the bank has accumulated about $20,600 in deposits and involved more than 247 students, more than half the student body.

Eagerly, the children jockey for position in front of Teresa Webster, a parent volunteer, to have their deposits recorded on her personal computer.

"Everybody back against the wall unless you are doing banking," shouts Webster. She looks at a small boy in front of her table. "Have you endorsed? Remember, you have to write your name."

Moments later, 8-year-old Veronica Brown pulls several dollars and some change from a tiny bank pouch. After completing her deposit, she moves to another table where other parents reward her with a colorful sticker for her savings register. With a big smile, she leaves the banking center to return to her classroom.

Nationally, such educational efforts have support from the American Bankers Association and other banking industry trade organizations. The bankers' group has put together a series of videos and a comic book designed to teach personal finance. The comic book called Meet the Bank takes children on a field trip through a bank, with stops to meet tellers and bank officers and to watch how a check moves through the system.

As with adult accounts, features of children's accounts can vary widely. Parents are advised to shop around for the best deal.

Some accounts require $100 or more for a minimum balance, but other institutions waive minimum balances for youth accounts. Some waive fees until the child is 16, and others waive fees until age 18. Like adult accounts, each bank pays different rates of interest.

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