Providian Bancorp is aggressively wooing people who have had credit problems or have no credit history, and trying to turn them into profitable secured-card customers.

Providian said the profitability of its secured-card business doubled in the past two years. The increase in the number of accounts, balance per account, and fee income were largely responsible.

With 354,000 secured-card accounts garnered since 1991, when the program was started, the San Francisco-based bank claims to have the largest share of the market, and says its share continues to grow rapidly.

Also, last year Providian said its secured-card customers were 30% more profitable than it expected.

"Just because people don't qualify for credit it doesn't mean that they don't want it," said Julie A. Montanari, who is president of the bank's emerging businesses, including secured cards.

Ms. Montanari said she defined customer profitability in terms of interest rate, fees, and the interchange rate.

She attributed Providian's success to "innovative marketing programs and economies of scale."

The biggest hurdle in opening a secured-card account, said David Robertson, president of The Nilson Report, Oxnard, Calif., is convincing people to return an application with a check.

"Providian is rather masterful in contacting customers who would be interested in secured cards, and also in designing the direct-mail pieces so that people actually return the deposit" necessary to open the account, Mr. Robertson said.

Last year, Providian lowered the minimum deposit required to open an account to $200 from $300.

Through its subsidiary, First Deposit National Bank of Tilton, N.H., which issues the secured cards, Providian charges a 19.8% interest rate, and a $35 annual fee, according to Ram Research Group, a credit card tracking firm in Frederick, Md. The firm's survey of consumer credit cards shows that Providian's pricing is average for this market, it said.

Providian plans to develop direct-mail solicitations in several languages. Currently, mail pieces are offered in English only, though customer service representatives are available in about 10 languages, said Ms. Montanari.

A handful of other banks market secured cards in Spanish, including First Consumers National Bank, Beaverton, Ore., and People's Bank of Bridgeport, Conn.

Some of Providian's competitors seem baffled by its success.

"Other than the cost of funds dropping, I don't see why they would be so profitable," said Mark K. Vitelli, first vice president of consumer credit at People's Bank.

Patti D.W. McCoy, a First Consumers senior vice president and director of marketing, said that Providian's "contention that they are the largest is their belief, because there is no legitimate ranking of secured cards," since many issuers do not report information on such accounts.

Ms. McCoy said she believes that Providian is among the top five issuers. She would not disclose the number of secured cards the bank issues. Among the other top issuers of secured cards are Capital One, Citibank, and First Consumers, according to industry sources.

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