PNC Bank Corp. plans to dovetail the expansion of its mortgage company with a pitch to place more products with borrowers.
The Pittsburgh-based banking company will combine market research and technology to sell home equity loans, credit cards, and investment products to mortgage customers, its president, James E. Rohr, said in an interview here.
"Right now, we don't take the mortgage customer and cross-sell to them," Mr. Rohr said during the company's annual mortgage sales meeting. "That's a tremendous opportunity for us."
The banking company wants to do more with the thousands of customers who bought $5.6 billion of mortgages last year and those whose loans are held in the bank's $39.5 billion mortgage servicing portfolio.
The cross-selling drive is linked with a national expansion that's planned this year for PNC Mortgage. Under the guidance of chief executive Saiyid T. Naqvi, the Vernon Hills, Ill., mortgage unit expects to blitz the country with office openings, especially in the West.
"Our mortgage company is positioned to continue rapid growth," Mr. Rohr said.
If the cross-selling effort succeeds, PNC would become one of the first banks to bring multiple products to customers who initially planned just a single transaction.
Banks have failed at cross-selling in the past because they embraced mass marketing, instead of a targeted approach, and did not follow up, industry analysts said.
"Banks have not found it all that easy," said Ronald I. Mandle, banking analyst at Sanford C. Bernstein & Co., New York. "It will take a lot of perseverance."
Fee income from cross-selling loan and deposit products would complement mortgage unit core earnings, which were $153.7 million last year.
PNC is touting call centers and other advanced technology that will enable it to execute its strategy, as well as demographic studies and other research that support its cross-selling agenda. But Mr. Rohr acknowledged that PNC's strategy is partly based on trial and error.
For instance, the company has learned that customers at closings are often inclined to accept home equity loans because of their similarities with mortgages.
Credit card pitches also have their place but not until several months down the line, when furniture is being bought, Mr. Rohr said.
"We've still got a lot to learn," he said. "But we believe we're on track."
Industry observers said PNC may have a leg up on the competition in making the cross-selling program work because it puts tremendous emphasis on customer satisfaction.
"If borrowers have a positive experience, they would be more amenable to another experience with the bank," said Anne Moore, managing director of Synergistics Research Corp., Atlanta.
