Synovus Financial Corp. has agreed to invest $2 million in Security First Network Bank, which operates almost exclusively on the Internet.

The investment would entitle Synovus to stock in Security First upon completion of the on-line bank's spinoff from its parent, Cardinal Bancshares of Lexington, Ky.

As part of the spinoff, Security First plans to acquire Five Paces Inc., the Atlanta-based software firm that developed the system on which the virtual bank operates.

Synovus intends to license Five Paces software, known as Virtual Bank Manager, for use in its bank subsidiaries.

"Strategically, this is an excellent investment for Synovus and a great opportunity for us to participate in the early stages of this technology," said Synovus chairman and chief executive James H. Blanchard.

The $7.9 billion-asset Synovus owns 34 banks. It also controls 80.8% of Total System Services Inc., the credit card processor for Security First.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.