Bankers Wary As Ameritech Unveils Card

NEW YORK - Bankers responded with mild concern to a new credit card unveiled Thursday by Ameritech, the Chicago-based parent of Illinois Bell.

The new entry, a MasterCard dubbed the Complete card, entails no annual fee. Features include a 10% rebate on calls charged to the card and an unusual interest rate structure designed to encourage cardholders to raise outstanding balances.

"We always need competition, but it's bad news that another major issuer is giving away a card for free," said Jerry Wagner, senior vice president at Rocky Mountain Bank Card System.

The new card offers a discount on local and long-distance calls, unlike AT&T's Universal Card, which gives discounts only on long-distance. But bankers did not express the same alarm as when the Universal card was introduced last year.

Plenty of Issuers

Many bankers said that it was only a matter of time before regional phone companies followed American Telephone and Telegraph Co. into the credit card business.

"There are 6,000 institutions that issue MasterCard and Visa cards," said Scott P. Marks, head of credit cards at the First Chicago Corp. One more doesn't make much difference, he said.

Ameritech, whose telephone subsidiaries serve some 12 million consumers in five midwestern states, began mailing card solicitations to customers on Thursday. As expected, the card will be issued by Household Card Services, Salinas, Calif., a subsidiary of Household International in Chicago.

The card's most unusual feature is a tiered pricing structure, one that other issuers may soon adopt. Users will be charged 19.8% on balances of up to $999, 18.8% on balances ranging from $1,000 to $1,999, and 16.8% on balances that exceed $2,000.

The tiered structure will inevitably spread, some bankers said. "All of us are struggling to find out what appeals to consumers," said James Trigg, senior vice president in charge of NCNB Corp.'s credit card unit. "This is just another tool that some issuers will use."

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