Electronic banking maven Del Tonguette has learned that being late to the party doesn't mean you won't get to dance.

As an Ohio banker with a strong technology background, Mr. Tonguette in 1986 helped incorporate and now heads an electronic funds transfer company that, by his reckoning, was the last big regional network to form around the concept of sharing automated teller machines.

That organization, GulfNet Inc., now links 2,100 ATMs and is the dominant ATM mark in Louisiana and Mississippi.

And despite its relatively late start. GulfNet is now being eyed as an attractive acquisition target by other networks.

"Our area of the country was a little slow to introduce shared ATM networking," Mr. Tonguette said. "But the positive side of that for us now is that our [ATM] transaction levels are just starting to take off."

Transaction Growth of 20%

Mr. Tonguette said the number of transactions switched between GulfNet member financial institutions is growing at an annual rate of 20%. And that growth shows no signs of slowing down.

Yet despite this transaction growth and revenues of more than $1 million in 1992, Mr. Tonguette is a realist who has believed for years that his network's destiny is to be absorbed by a larger network.

"I think it's absurd that we have a bunch of networks all with brand names. We don't have that in the credit card industry and credit cards are phenomenally successful products," he said.

"I see a day coming -- and it's not that far away -- when there will be six networks supporting a couple of brands."

Offers Solicited

According to industry observers, Mr. Tonguette has actively shopped his network to other larger companies since 1988, and now those efforts appear ready to bear fruit.

Delaware-based Electronic Payment Services Inc., which operates the MAC network, and Florida-based Southeast Switch Inc., which runs the Honor network, are now both bidding to buy GulfNet, and observers feel a deal will be worked out by the end of year.

Mr. Tonguett knows that many regard his efforts to sell off the very company that employs him as comparable to pulling the rug out from under himself.

But, Mr. Tonguette explains, aside from the fact that he believes selling the network is part of his responsibility to the company's stockholders, he is confident of his ability to find new work in the electronic funds transfer industry.

Jobs in the Back Office

"When the consolidation takes hold, all of us network directors aren't going to be out of jobs," he said. "There always have to be back-office operations, just like in the credit card industry, where we have companies like [First Data Resources Inc.]"

Throughout his more than 20 years in the consumer banking industry, Mr. Tonguette has displayed an ability to jump from project to project and always land on his feet.

The recipient of degrees in marketing and psychology from Bowling Green State University and an eight-year veteran of the Air Force, Mr. Tonguette began his postmilitary career inauspiciously:

"[In 1968] I headed towards Columbus [Ohio] and literally just looked for the tallest building in the city, which I figured was my best for a job," Mr. Tonguette said.

Stint at Banc One

While Columbus' tallest building proved a bad place for a job search -- "Just a bunch of small offices," he said -- the second-tallest building housed Banc One Corp., where Mr. Tonguette found work in a fledging credit card program.

From Banc One, he went to jobs with numerous Ohio banks, including Bank Ohio, which is now part of National City Corp., and Fifth Third Bancorp. His jobs included everything from installing prototype ATMs that dispensed cash in envelopes to helping to establish the Jeanie ATM network in Ohio.

Eventually he was contacted in 1985 by First Commerce Corp., the New Orleans holding company that owned part of the then fledging GulfNet network.

Five Million Cardholders

In his eight years at the network, Mr. Tonguette has watched GulfNet's cardholder base grow to over five million. GulfNet cards can be used at ATMs in Arkansas, Louisiana, Mississippi, Tennessee, and Texas.

But, even as the network continues to grow, Mr. Tonguette continues to look beyond his stay at GulfNet to a time when the multiple ATM brands of the present can be replaced by a simpler, more efficient system of electronic banking.

"Brand duplication is very costly, and the consumer pays for it, in both dollars and in confusion factors," he said. "If we had just a couple of brands to actively promote, the whole industry would gain from it, and of course the consumer would too."

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