In many ways Britton & Koontz First National Bank in Natchez, Miss., is your ordinary, conservative small-town community bank. For example, mortgage and home-equity loans make up 50% of its $162 million loan portfolio.

But two years ago something about the Internet brought out the riverboat gambler in the $238 million-asset bank.

In December 1998 it invested $1 million in Sumx Inc., which its own chief financial officer had formed in 1996 to create an online banking package for Britton & Koontz and other banks.

The 164-year-old bank had never made a venture capital play before it handed 5.2% of its capital to the CFO, Bazile Lanneau Jr., and Sumx, of which he is chief executive officer.

Now, after nearly $300,000 of losses for the bank, the investment seems ready to begin paying dividends. On Dec. 22, Diebold Inc. of Canton, Ohio, announced that it was close to concluding a deal to market Sumx to its customers around the world.

William R. Aitken, vice president and general manager for systems integration and services at Diebold, which reported revenues of $1.3 billion in 1999 and has more than 11,000 employees, said the company also plans to use Sumx to extend Internet banking capabilities to automatic teller machines.

Diebold, best known as a manufacturer of automatic teller machines, would assume responsibility for the sales, installation, and support of Sumx software and allow Mr. Lanneau's six-employee firm to concentrate on improving its product, Mr. Aitken said.

Mr. Lanneau said partnering with Diebold would dramatically alter Sumx's outlook for this year. What looked like another 12 months of losses would turn into a net profit, he said. "All of a sudden we're ready to have some value."

Diebold would not discuss its sales projections for Sumx. Sumx currently has seven bank clients, including Britton & Koontz.

W. Page Ogden, president and CEO of Britton & Koontz, said it was the first bank to adopt Sumx as its Internet banking provider and has served as a kind of laboratory ever since. Four years since it began offering Internet banking in Natchez, 33% of Britton & Koontz's customers there use the online service, he said.

News of a possible alliance between Sumx and Diebold has already had an effect at Britton & Koontz, which owns 37.5% of Sumx. Since Diebold's announcement, the bank's stock has set daily volume records twice. On Dec. 26 alone 17,000 shares were traded.

The stock price has not performed as impressively, however. Shares were trading at $12 midday Tuesday, up only 9% since its close on Dec. 21, the day before the announcement.

Still, for a stock whose daily volume generally numbers in the hundreds, and goes for long stretches without any trades at all, any interest is encouraging, Mr. Ogden said. "It warms my heart."

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