In business, it often seems the higher the prestige, the smaller the profits. Consider lending: Big syndications make the chairman look great, but spreads thinner than 150 basis points have been rumored on recent deals in the billions. Auto loans, however, are comparatively humble; but a spread north of 300 basis points on a car loan is typical.

The vehicle lending business is estimated to reach $481 billion in assets this year, so it's no wonder that Steve LaMore, president and CEO of Barnett Dealer Services, Inc., is finding ways to grab major market share. LaMore's operation, which currently has about $6 billion in outstanding loans and processes about 60,000 credit applications a month, recently signed on with a joint venture struck between the Dealer Services Group of ADP and Credit Management Systems Inc. (CMSI) that basically lets LaMore's group pick and choose between loans it wants to make and loans it wants to refer for a fee to sub-prime lenders, growing both Barnett's interest and non-interest income. LaMore's plan is to refer loans to a Barnett- established network of sub-prime lenders for fees ranging from $100 to $500, cutting his losses and improving his expense ratios and efficiencies. One sub-prime lender-TransSouth Financial Corp.-is participating, but LaMore says he is negotiating with five unnamed others.

By using ADP/CMSI's Credit Connection, a system enabling car dealers to submit credit applications electronically, deals are executable even when the office is closed. Barnett Dealer Services is in the process of signing up dealers for its new auto lending system.

LaMore hopes to take the bank's auto lending business national. With its recent acquisition of Oxford Resources Corp., one of the biggest companies in the lease financing business, Barnett's auto lending business now spans about 20 states.


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