When Varghese Chacko came to America 20 years ago from his native India, he tried to get a bank loan to start a direct mail business.
He failed, largely because he had no credit history here, but managed to scrape together enough of his own money to start the business in his garage. Today, Prompts Services has 40 employees and a client list that includes Cingular Wireless and the Chicago Tribune.
Now Mr. Chacko is starting another business, a bank that will target Indian and South Asian Americans who want to get into business for themselves.
"I wanted to be part of a bank to help out others, and now that dream is coming true," he said.
All American Bank is set to open its first branch, in the Chicago suburb of Des Plaines, at the end of the month. Though dozens of banks serve immigrants from Korea, China, and other East Asian countries, this would be the first devoted to the Indian community.
All American has received regulatory approval and raised $8 million. Mr. Chacko is to be its chairman, and he has hired an experienced banker, whom he would not name, as his chief executive officer.
According to the Office of Immigration Statistics, Indians are the nation's third-largest group, behind Filipinos and Mexicans, of "legal permanent residents" (immigrants who are not U.S. citizens). In the Chicago area in 2003, 2,557 Indians became U.S. citizens, third-most behind Mexicans and Poles.
Mr. Chacko said his bank will focus mainly on small-business financing.
"The Indian community is very entrepreneurial, and the majority is looking to be business owners," he said.
All American's offerings will include a travel club, modeled on bank Christmas clubs. These interest-bearing savings accounts will be used to fund trips to the customers' home country.
Mr. Chacko said the typical Indian travels home every two years. If a travel-club account holder does not save enough money for the trip but has good credit, All American will extend him or her a small short-term loan.
Homeowners will be eligible for home equity loans to help build homes in India, and All American is partnering with banks in India.
Mr. Chacko is promoting the bank through the Indian media and Indian organizations. He is also making use of his contacts at the U.S. Pan Asian American Chamber of Commerce's Midwest chapter, of which he is president.
Mr. Chacko said that once All American has name recognition around the Chicago-area Indian community, he hopes to expand into other parts of Illinois and eventually to other major cities.
The Indian community "thinks banking is just checking and savings," he said. "But a bank can do more for the community, and we want to make them aware of it and help them with their financial needs."
