ATLANTA - Bank South Corp. is about to test whether alternative delivery is the key to winning small business market share.

While most banks are focused on centralized underwriting to speed loan approvals and lower costs, Bank South officials say these may not be enough to distinguish a midsize player in an overbanked market.

"You have to redefine convenience," said John Brooks, division manager of the bank's small business unit. "It's not really how quickly you get a decision back to you, but it may be points of delivery that make it easier for you to deal with a bank."

To that end, the $7.2 billion-asset bank plans to use alternatives ranging from telebanking to the company's successful Kroger grocery store branches to replicate its success in capturing the consumer market.

In the face of competition from First Union Corp., NationsBank, and scores of profitable community banks, Bank South has captured a growing share of the consumer market largely by fitting the customer's schedule.

By its own estimate, Bank South today has a relationship with about one- third of all metropolitan Atlanta households. Mr. Brooks acknowledged that whether he can broaden the bank's estimated 10% of the small business market will depend on mixing technology with the personal touch.

"There are a lot of banks out there which have a good underwriting process, but I'm not sure they understand the relationship fully," said Mr. Brooks. "I see the (community) banker as our greatest competition. They are more hands on and more of their senior people are closer to the customer."

Since starting its small business unit last August, Bank South has offered small business customers the option of transacting a loan in any of its 156 offices, including its grocery store branches.

Mr. Brooks says the number of small business loans in those nontraditional branches is not yet significant, but he expects that activity to grow as business borrowers see extended hours as a plus in personal schedules that are rarely 9 to 5.

The bank is planning to place specially trained operators in its telephone banking center to handle questions from - and to sell products to - small businesses. Like others, Bank South is also studying ATM usage by small businesses to see if there are special needs.

The company also plans to use the Screen Phone it will introduce with Bell South this May to attract small business customers. Officials won't say how they plan to use the phone in this market, but they maintain the multi-function phone will appeal to entrepreneurs.

"We're trying to build more points of entry," Mr. Brooks said. "I think we have a 12- to 18-month window of opportunity to establish ourselves and I think the convenience will drive it."

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