PNC Bank Corp. said it has formed an unusual alliance with two other companies in hopes of growing into the top ranks of credit card issuers.

In what the principals call a first-of-its-kind strategic partnership, PNC will rely on First Data Corp. for processing services and Card Issuer Program Management Corp. for marketing help.

PNC, previously a software client of First Data's Card Services Group, will likely become a much bigger customer of what is already the No. 1 provider of account processing services to MasterCard and Visa issuers.

PNC will also be one of the first major customers of Card Issuer Program Management, a company formed by former Wachovia Corp. and First Data executive Jerry D. Craft. Mr. Craft has left First Data to work with PNC and other clients, often in alliances with his former employer.

The Pittsburgh-based banking company is out to accomplish something like what Mr. Craft engineered at Wachovia - a rise from credit card obscurity into the industry's top 25.

If successful, PNC may regain some measure of past glory. As Pittsburgh National Bank, it was one of the original MasterCard (then Master Charge) banks in the 1960s.

Although PNC ranks 12th among U.S. bank holding companies, with $64 billion of assets, its Delaware credit card bank ended 1994 at only 42d in outstandings, with $816 million, according to The Nilson Report. Wachovia had about five times PNC's outstandings, 17th on the list.

A. William Schenck 3d, executive vice president of consumer banking, said PNC regards this new type of "strategic relationship" as the ideal way to "grow intelligently and rapidly" in credit cards.

Though reluctant to give exact projections, he said PNC expects to surpass the card industry's overall annual growth rate of 15% to 20%.

PNC has seen its hometown archrival, Mellon Bank Corp., make big credit card strides over the last year. Largely on the strength of the Cornerstone MasterCard, which promises to refund customers' interest payments over a 20-year period, Mellon Bank Delaware boosted outstandings by 65% last year, to $2.4 billion, 23d on the Nilson list.

PNC has been making other bold moves. It said last November that it would close up to 30% of its 612 branches over three years, picking up the slack with telephone-based services.

The bank, a co-owner of Electronic Payment Services Inc. and its MAC automated teller machine network, also has become an aggressive deployer of the machines. It recently announced plans to put more than 500 of them in Wawa convenience stores in the Philadelphia area.

In its tripartite credit card arrangement, PNC will retain ownership of the portfolio and control over credit and pricing policies. The bank is thus emphasizing enhanced customer relationships in which credit cards, historically stand-alone products, play a more integral role.

PNC chairman Thomas H. O'Brien said his customers will be the real winners because they will get more service options from "the financial services organization they're most familiar with."

Mr. Schenck said that aside from doing more with its 2.7 million households, PNC simply wants "to get into the (credit card) game. . . . This is a very good business that we want to make more in keeping with the size of our company."

PNC could not have done this alone, he said, and necessarily turned to "the best in the business" at processing and marketing. He expects banking companies in general will find such arrangements increasingly attractive as they sort out strategic options.

First Data, which has its card services headquarters in Omaha, will manage all systems and back-office operations, including account-level and transaction processing.

Mr. Craft said his firm will assist in bringing "the right products to the right customers at the right time. By putting our expertise to work for PNC Bank, we can maximize the effectiveness of the bank's credit card products with its targeted customer base."

"This is the first time a bank has outsourced in this way," said A. Wayne Johnson, who before leaving his post as executive vice president in First Data's Card Services Group helped put the deal together.

"The bank combines its strengths - the customer interface - with our processing and Jerry Craft's marketing expertise," said Mr. Johnson, who now heads a First Data collections operation in Phoenix.

First Data's Card Services Group, under executive vice president Walter M. Hoff, is the largest processing organization of its kind, serving some 1.3 million merchants and 700 financial institutions with nearly 100 million card accounts.

Mr. Craft joined the group less than a year ago, creating a major stir in the bank card industry after almost 12 years with Wachovia. He has become president of Card Issuer Program Management on terms that do not seem to spell a retreat from what he and First Data have been trying to accomplish together.

The new firm offers portfolio management and marketing expertise. Mr. Craft and his clients will turn exclusively to First Data when they need processing, operations, and customer-service support, said company spokeswoman Synetta Armstrong.

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