During an April week when many bank card executives were hunkering down, trying to figure out ways to stem delinquencies, Collin McKenny was standing before a group of novices, teaching Bank Cards 101.

With an overhead projector and a pile of numbers, the Star Banc Corp. executive quickly got the students up to speed on the financial dynamics of the business. It is the kind of educational setting - the audience could just as well have been customers, reporters, or industry peers - where Ms. McKenny is most at ease.

"I'm a teacher at heart," said the 52-year-old senior vice president. "I really enjoy that kind of interaction."

Recently a customer called to complain about certain restrictions on redeeming frequent-flier miles earned with his Star Bank credit card.

She invited the customer into her office. When he arrived, she pulled out documents on his account relationship that showed exactly how much it cost the bank to redeem his miles. He left without the miles he wanted but with an understanding of the business.

"He told me it's the only battle he's ever lost," Ms. McKenny said.

"You might not like what Collin tells you, but she's always telling you the truth," said Maura Matzko, group director for bank products at the American Bankers Association.

Others may shy from using real numbers in their programs to make a point. Not Ms. McKenny. She remains a frequent speaker at industry conferences, even as many of her contemporaries become ever more reluctant to divulge anything about their businesses.

"She has probably done more to promote the understanding of marketing than most, given her willingness to share results," said San Francisco- based bank card consultant K. Shelly Porges.

A native of Seattle, Ms. McKenny got her start at the now-defunct Peoples National Bank, where she inherited the card program. She moved to Barclays Bank in 1985 to head up its North American bank card strategy.

Ms. McKenny has been an active participant in a number of ABA programs, including the National School of Bank Card Management in Delaware where she was teaching in April.

"She really understands what drives the card business," Ms. Matzko said. "She also has a keen understanding of why it's so critical that you give people you're developing in this industry that depth of understanding."

Ms. McKenny adjusts her presentations for the times. This year, she told students that loan losses would be the greatest single expense in card programs for 1996, exceeding the cost of funds for the first time.

"I'm not going to give away everything," she said, "but I'm willing to give enough information to let someone measure their own success or lack of success, to provide them a benchmark. Otherwise, how do you know you're achieving what's possible to achieve?"

Strictly by the numbers, Star Banc is not seen as an overachiever in credit cards. The Cincinnati-based regional company ranks only 62d nationally in outstandings, at $355 million, and 70th in charge volume, at $260 million. (The figures come from The Nilson Report, Oxnard, Calif.)

Cards contribute about 5% to the bank's bottom line, but the business has been growing by 30% to 35% annually for the past three years, said Richard Davis, executive vice president of retail banking.

When Ms. McKenny came aboard eight years ago, the company had issued 70,000 cards, compared with 240,000 now.

What the program might lack in size, it makes up for in originality, Mr. Davis said. He said he has been able to keep a talent like Ms. McKenny because "she realizes that we embrace the opportunity to try new things here which fundamentally make sense."

This month, for example, Star is testing an enhancement from Dining A La Card, which gives Cincinnati-area cardholders a 20% discount on restaurant tabs, minus tax and tip.

Participation in the program, which is limited to about 100 restaurants, costs $20. It differs from most dining discount programs because cardholders don't have to show a separate membership card.

"We think it's a neat concept that's not been tried anywhere," Ms. McKenny said. "We'll expand to other key markets and major cities in the Midwest once the test meets our expectations."

Star has another idea up its sleeve: a card for people who want to save for their children's college expenses. To make it work, the bank must sign up a number of national and regional retailers who will contribute up to 5% of transactions to the cardholder's fund.

Mr. Davis said Ms. McKenny generates many ideas for products or enhancements and is able to home in on those that work for Star.

One she decided does not work is a cobranded grocery card - a product its competitor Fifth Third Bancorp markets. "I haven't figured out how to make money on a grocery store cobrand," Ms. McKenny said, because the balances are low and transaction numbers high.

Star Bank has found its niche in variable-rate cards that it can bring to market faster than others. Star Miles, which rewards cardholders' spending with frequent-flier miles that can be redeemed on any airline, has been profitable.

"It paid off with higher average balances and higher utilization," Ms. McKenny said. "It's very targeted, very focused, with less than 10,000 accounts.

"We only solicit revolvers, you can't make money on too many transactors."

Translation: The bank wants interest income, not customers who pay off their balances interest-free.

The mileage-rebate idea was so successful, Star Bank extended it to its mutual fund area. In essence, the card group has become a marketing laboratory, Mr. Davis said.

Also in Ms. McKenny's domain are correspondent card services, merchant services, business cards, and debit cards. Star manages the portfolios of 125 smaller banks, as well as Republic National Bank of New York. In the merchant area, it has 5,000 clients - and 6,000 more for its correspondent banks.

Star's retail side takes care of product management for 160,000 Visa check cards, but Ms. McKenny's group provides back-office support.

She said the bank has two core card strategies: price and value.

"We are primarily a price issuer, and we overlay value through enhancements like Star Miles," she said. "Therefore, our underwriting is more conservative than the average bearer, and our losses are lower as a result."

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