Once upon a time, upgrading computer systems in preparation for the new millennium was just a technology problem. But now, as the programmers put the finishing touches on computer changes, a chorus of regulators and consultants is urging all banks to think of Year-2000 as a marketing issue as well.

"It's not enough to fix your data systems if your customers don't know about it," said Comptroller of the Currency John D. Hawke Jr. at a recent conference in Washington. "They're hungry for reassurance."

A number of banks have risen to the challenge with marketing campaigns designed to calm a skittish public. Their stories should help inform other banks confronting the same concern.

Take Viking Financial Services Corp., a $93 million-asset bank company in Seattle.

Though the bank was certain that its computers were ready for the 2000 date change, officers worried that internal tests did little to convince consumers that the small, company would step into the next millennium unscathed. And if customers lost faith in the bank, the consequences would be just as severe as an actual computer failure.

"This is the seminal event in our life as a company," says Pat Redmond, chief executive officer of seven-year-old Viking Financial. "If our customers lose confidence in us, the results would be catastrophic."

So Viking Financial decided to send a message to its customers. Targeting senior citizens, a customer segment that the bank believed was most nervous about Y2K, Viking Financial made a simple pledge: if computers went afoul on Jan. 1 and Social Security checks were not electronically deposited into accounts as usual, the bank would cover the checks with interest-free loans.

Truth be told, Viking had very little to risk in making the promise. Viking has very few customers who receive Social Security checks by direct deposit. And analysts are confident that Social Security will be ready for year-2000.

But in time, the bank's marketing gimmick garnered it publicity that it was ready for the date change. (See sidebar.)

Such publicity can be viewed as a necessary counterweight to a spate of sensationalist press coverage. There have been magazine articles and advice columns urging folks to take their money from small banks. And the paranoia will likely continue. Hollywood, for example, is preparing at least two year-2000 disaster films for release this fall.

"There is a lot of fear brewing in the communities," warns Kevin B. Tynan, president of Tynan Marketing Inc. in Chicago.

Mr. Tynan says all banks should be initiating discussion with customers. "Every bank needs a major public relations campaign to reassure people," he says. "Consumer panic is much more dangerous right now than technical glitches."

Last month, Bancorp of New Glarus, Wis., shut off the power at its main office to illustrate to customers that even if there were problems, the bank would be fine.

"The old rule in marketing is that to get the message out, you have to keep banging it into people," says John Thomson, chief executive officer of the $70 million-asset bank. "This is a good old-fashioned attempt to be dramatic and make a point."

Mr. Thomson invited community leaders, the police department, and interested customers to the demonstration. He took them into the dark office and proved that the vault would open, even if the power was off.

"I have a few customers who want to take their money out, but don't know where to put it," he says. "Even if they are afraid their savings will be erased, I want them to consider putting a cashier's check in the vault. I don't want everyone walking around with wads of cash."

Wilton Bank in Connecticut, meanwhile, used a visit from the area congressman as an opportunity to attract media attention to its progress. James H. Maloney, a member of the House Banking Committee, attended a meeting of the $90 million-asset bank's year-2000 committee, and then held a press conference in front of stacks of computer test printouts.

"It was very visual, which was perfect for the press," says Nicki Brown, chief executive officer. "Its hard for people to understand all the work we have done without seeing a visualization like that stack."

Dallas National Bank in Texas is incorporating the date change into a series of programs it sponsors for its small business customers. Normally, the $34 million-asset bank invites professors and other experts in for breakfast to address topics like the health of the local economy.

Recently, however, the bank has also asked representatives from the Office of the Comptroller of the Currency in to talk about what banks are doing to prepare.

J. Mike Nichols, vice president at the two-year-old institution, says it was hard to gauge how successful such programs are. But he is heartened that only one customer has come to him to express concern.

"All we can do is keep reassuring customers, hoping they realize that we feel comfortable about what we have done," he says.

Even if elaborate displays or special meetings are not in the cards at every bank, there are some basic steps everyone should be taking, Mr. Tynan says.

Banks should issue periodic press releases to remind the local media that progress is being made. And once testing is complete, institutions should invite customers in for an open house where they can ask questions about the preparations.

At First Federal Bank in Hazleton, Pa., a briefing to explain what the bank was doing educated reporters about the issue. The result? The $520 million-asset thrift has become a resource for reporters trying to understand the complex issues involved.

Being a source for local newspapers "gives people some comfort that we are well aware of the issues," says E. Lee Beard, First Federal's president.

Banks should also provide training to employees on how to answer customer questions. "Its important a single message comes out of the bank," Mr. Tynan says.

If community banks are successful, the time spent educating customers could pay off in business in 2000 and beyond, bankers say.

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