"If you're going to be a bear, be a grizzly."

That's the advice for bankers from Jack W. Whittle, chairman of Whittle & Hanks, a Chicago-based financial marketing company.

It isn't deadbeat borrowers Mr. Whittle wants banks to get tough on; it's depositors.

As a true believer in the fee-income gospel, Mr. Whittle wants banks to start charging customers for deposit insurance.

|Next to the flag and God'

"We're getting right next to the flag and God when we talk about FDIC insurance," he said. "You've got to really sell it."

Mr. Whittle made his pitch at the American Bankers Association convention in Boston.

Revenue from fees ought to cover a bank's employee salaries and benefits, he says.

To persuade his audience, Mr. Whittle presented results from telephone surveys of 18,000 depositors over two years.

"An explicit surcharge is preferable to customers over reduced deposit rates, higher loan rates, [or] higher service charges," according to Whittle & Hanks research.

A Third Ignore Statements

Nearly a third of depositors don't open their statements; more than 50% don't bother in August and December. "These are the months to reprice," he said.

Mr. Whittle recommended a once-a-year charge for deposit insurance. "You don't want to bleed your customers," he said. Banks also should pass through only a portion of the insurance cost at first.

"Pass through the last FDIC increase," he said. "You're not going to make a whole bunch of money in the beginning, but you are going to start a way to defray the cost."

Mr. Whittle suggested that banks write their customers a letter explaining how deposit insurance works and how much it costs. A stuffer or simply a line on the statement will suffice, he added.

Banks that choose to add a line to the statement, however, "better have every person in the bank able to explain it when the calls come in."

That means training is important. Mr. Whittle said 29% of bank employees studied by his firm think the government pays for deposit insurance.

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