Chicago's Labe Federal Bank for Savings is using a new check-cashing program to attract people who traditionally have relied on local currency exchanges.

"The goal is to win them over first as a savings customer and, when they build up some deposits, get them to buy a home in the area," said Frank Kross, president of the $105 million-asset thrift.

The thrift, which is named after a Czech river, hopes to cross-sell a slew of other products once the new customers are in the door.

Labe, a 91-year-old institution on the city's northwest side, is demonstrating how banks and thrifts can develop new niches within their existing markets - in this case, a radius of about a two miles.

The thrift is reaching into what it sees as an untapped market of different ethnic groups and blue-collar customers, many of whom are unbanked.

"The people here are, at times, intimidated by banks," Mr. Kross said.

But perhaps some less than they were: Since the check-cashing program was initiated earlier this year, 200 customers have signed up.

Labe hopes to garner even more through recent marketing efforts, including coupons in ethnic publications for free check-cashing and door- to-door solicitation, said Vicki Dreyer, director of marketing.

For noncustomers, Labe charges a flat $3 fee for each check cashed. The thrift will cash government and payroll - but not personal - checks as long as the person fills out a registration card.

Currency exchanges typically charge a percentage of the check, so their fees can amount to much more, said Jack Macholl, a communications consultant who helped Labe implement the program.

The thrift has an outside walk-up window for people who may feel intimidated by banking. To make Labe's ethnically diverse clientele feel more at home, 10 different languages are spoken by its teller staff.

It also offers other products and services people would find at a currency exchange, such as postage stamps, money orders, and bill payment.

Labe is betting that many check-cashing registrants will eventually be making mortgage payments. "I'm confident that it's going to happen," Mr. Kross said, referring to the thrift's ultimate goal. More than half of the residents of Labe's market area currently rent their homes, Ms. Dreyer said.

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