Santa Monica Bank, simply by amusing people, has picked up a healthy share of the lending business spurred by Southern California's recent earthquake.

The bank -- Santa Monica's top construction lender -- has been hit far harder by tumbling real estate values than it was by the quake.

But not hard enough to blur its vision. So the bank, which holds $688 million in assets, has remained focused on its niche. And it keeps entertaining Los Angeles motorists with the ads it runs on buses.

In fact, after the earthquake -- whose epicenter was in Santa Monica -- the bank started running "advertorials" to promote its emergency lending. All the other banks did, too. But they didn't have the humorous tag lines drawing attention to their programs -- and that, the bank believes, gave them an edge.

Comic Relief

"The ads we can ran after the earthquake were designed to lift peoples' spirits," says Aubrey L. Austin, president of the bank. "But we've been running those kinds of ads for many years."

The promotions are developed by Team One Advertising, El Segundo. As always, the latestt one consisted of an ad for name recognition -- a lavender bus card that says groveling isn't required at the bank - and a print ad offering empathy, and emergency loans, to victims of the quake.

The print ad equated the "aftershock" prevailingg in affluent Santa Monica - otherwise known for an abundance of composure -- to a squashed gnat. Mr. Austin estimates that the promotion has increased overall lending at the bank, which has eight branches, by 15%.

Big Piece of the Pie

All told, the bank spends 40% of its marketing budget on bus cards. Kevin Tynan, president of Tynan Marketing Inc., says transit advertising is a sound strategy in urban areas, but adds that 40% is a rather high proportion of the budget to spend on a single venue.

However, Pat Robertson, a Team One vice president, points out that the bus budget isn't overkill because the agency "does an entirely new bus card every month, so bus budget reflects a lot of production costs."

Evidently, the ads are worth the money. "Response to the gnat ads has been terrific," says Ms. Robertson. "The lending officers tell me the ads are bringing in customers beyond all expectations."

Devoted Following

Running on the backs of Santa Monica's 135 buses -- which travel throughout Los Angeles -- the ads have a devoted following. "People tell me they look for them," says Mr. Austin. "And I think that's why we picked up a nice piece of earthquake lending. People know about us.

"All the banks wre offering emergency loans, or repayment moratoriums, but we're much more flexible than Wells [Fargo] or Bank of America. We havve many multilayered relationships with our customers, and we tailored our assistance to individual situations."

About 30% of those relationships are secured by commercial real estate, which is bably depressed in Southern California. Sheshunoff Information Services data show that Santa Monica Bank had a 23.24% ratio of noncurrent real estate to equity capital - more than four times the national average -- at the end of 1993.

Value Level Off

But the foreclosure burdens are easing, Mr. Austin says, because the plunging values have leveled off and "we're starting to sell ourr [foreclosed real estate] above appraised value."

Meanwhile, his bank keeps people smiling, Mr. Tynan warns that "humorous ads win awards, but they don't always translate into sales." But Mr. Austin, whose grandfather started the bank in 1928, doesn't mind winning a trophy now and again.

"Last year we ran a print ad that went like this: 'You enter the room. Nobodyy says hi. Nobody speaks your name and nobody looks happy to see you. You've either walked into the wrong party or a big bank.'

"That ad won a Cleo award," Mr. Austin says. "Imagine that."

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