A Michigan community banking company wants to sell certificates of deposit on-line -- but not just its own.
Flagstar Bancorp, the $3.8 billion-asset parent of Bloomfield Hills-based Flagstar Bank, plans to launch a Web site late this month at which any bank or thrift would be able to compete for deposits by consumers and institutional investors.
The site is to be called Bankave, short for Bank Avenue, and operate as a Flagstar Bancorp subsidiary.
People who visit www.bankave.com are to begin by selecting the amount of the CD they want to buy and the period for which they are willing to commit their money. Then a list of participating banks and their rates will pop up on screen.
"We want banks from all across America to participate," said John Beeskow, vice president of Bankave. "If the buyer is looking for the best rate, they don't mind if the bank's next door or on the other side of the country."
Banks pay nothing to join. Bankave expects to make money by charging participating banks 0.1% of the value of each CD they sell.
Observers said Bankave could distinguish itself from other bank Web pages because on-line shoppers favor sites where they can choose among several vendors' products.
"Consumers don't want to be bound to a proprietary product from one provider," said Fred A. Cummings, a bank analyst at McDonald & Co. Investments in Cleveland. "They want multiple offerings so they can get the best price."
And though Flagstar might not always be able to offer the best price, Mr. Cummings said, "they'll still generate additional fee income."
Banking companies such as PNC Bank Corp. in Pittsburgh and USABancshares.com in Philadelphia already have started so-called CD auction sites.
But these focus on the company's own products in an auction format where people bid on CDs.
Bankave plans to operate more as a store in which people can pick the best deal on competing products.
Though Flagstar also plans to sell its own products, it will have no advantages over the other Bankave participants, Mr. Beeskow said.
"The Internet has changed a lot of business models," he said. "If we're providing a service that's a win for other banks, then so be it."
Four banks have committed themselves to join the site, and Mr. Beeskow said he hopes to sign up at least a dozen by the time it starts.
He would not name the participating banks.
