Mortgages are the key to the expansion plan for two southwestern banks owned by Raymond A. Lamb.

"Mortgages are the way we make initial contact with customers," said Mr. Lamb, principal owner of Bank of Arizona and Bank of New Mexico. "The loans are very important to us strategically."

The Arizona and New Mexico banks, which have $625 million of assets between them, plan to make about $400 million of mortgage loans next year, up from more than $200 million this year.

The lending operations, aside from fueling net income through originations and servicing sales, help instill a sales culture within the banks, Mr. Lamb said.

The banks, headquartered in Scottsdale, Ariz., and Albuquerque, operate a total of 14 branches and share many executives but have separate charters. Another 24 branches are planned for the next three years to fill out operations in the neighboring states.

Mr. Lamb, who has had ownership stakes in several banks during the past two decades, also envisions growth into Nevada and Utah either by opening new banks or adding loan offices in those states.

The company also includes mortgage loans in the product line at a handful of supermarket branches.

Why the big mortgage push? "If you're in the Southwest you really should be in real estate," said Jeffrey N. Walton, executive vice president for the banks' mortgage operations.

In the Phoenix area alone, 30,000 permits were issued for new homes last year, and nearby regions show similar strength, Mr. Walton said.

The banks cater to people who want loans to finance primary residences and also the growing number who are choosing the region for second homes.

The banks work closely with local realty agents and developers to keep close tabs on their markets, and that attention apparently earns respect.

Homebuyers respond to the "good communication and prompt closings" offered at the banks, said Robert Watt, general manager at White Hawke Inc., a Phoenix builder.

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