Trans Financial Inc. of Bowling Green, Ky., has taken another step in its metamorphosis from a traditional bank into an "information company" - by buying another travel agency.
The $1.9 billion-asset company last week bought Bryan Tours, a travel company with offices in Mississippi and Tennessee and about $15 million in annual gross sales. The deal is expected to nearly double Trans Financial's travel business.
"Traditional revenue sources will become stagnant, so we have to grow in new businesses," said Douglas M. Lester, chief executive of Trans Financial. "We see these sorts of things as being the wave of the future."
The company began its aggressive diversification a few years ago and shows no signs of letting up. Last summer it started its own mutual fund family, Trans Adviser Funds, and in the fall it started an employee training subsidiary.
It also has subsidiaries in venture capital, trust, mortgages, brokerage services, and traditional consumer banking. Trans Financial started its travel business from scratch in January 1994, then bought an agency last summer, before its latest acquisition.
"It's a natural move," Mr. Lester said. "It comes down to your distribution system. If you have a good sales force there are a lot of opportunities in these areas."
Trans Financial actively cross-sells its various products. Travel brochures and tour promos, for example, can be found in its bank branches.
Analysts said it's nothing new for banks to expand into the travel business. What is somewhat unusual is the aggressiveness Trans Financial has shown in this area recently, they said, and in pursuing other lines of nonbank business.
"Some of the traditional bankers out there are thinking, 'Let the other banks get into these lines of businesses and then they'll ignore their traditional customers,'" which in turn would create opportunities for competitors, said Christopher T. Kelley, vice president at Morgan Keegan & Co. in Memphis.
Trans Financial achieved record net income for its ninth consecutive year in 1995. Its returns on assets and equity in 1995 were 0.92% and 12.55%, both a bit below average for its peer group. Its efficiency ratio was a high 70.24%.
