First National Bank Holding Co. of Scottsdale, Ariz., has 26 branches in three southwestern states — and corporate customers in 49 states.
To serve them it plans to put a remote-capture imaging service into production in mid-March
The $3.5 billion company, which claims to be the leading provider of banking services to homeowner associations, is the first customer of a hosted remote-capture system from NetDeposit Inc.
Gregory J. Smith, an executive vice president and the chief operating and financial officer of First National and its three banks, said imaging will help maintain its leading position in this national niche business.
“We will be … able to dominate our markets with this product if we are first to market,” Mr. Smith said last week. Focus groups have shown “a huge demand by our customers,” he said. “Everybody is looking at this as the next generation of banking.”
First National serves Arizona, California and Nevada through its three-branch First Heritage Bank of Newport Beach, Calif.; the nine-branch First National Bank of Nevada; and its flagship, First National Bank of Arizona, with 14 branches.
The company and its subsidiaries have national programs for wholesale mortgage, merchant credit card processing, and the homeowners-association business. The Arizona bank has $550 million of deposits gathered through its Community Association Banc division, which specializes in homeowner associations.
Tests of the remote-capture system began in January. Until then all the associations or their property management companies sent members’ assessment checks through couriers or package delivery services such as FedEx Corp.
Remote capture lets customers convert checks into digital images and transmit them for same-day deposit.
Karen Scheer, the vice president of IT strategy at the holding company and its banks, said 18 of their customers are now testing the NetDeposit system.
Individual associations are using desktop scanners in their own offices to convert checks into images and send them to NetDeposit, a unit of Zions Bancorp. of Salt Lake City. NetDeposit aggregates the checks in its data center and forwards them to First National.
First National receives the images through an Internet portal and prints them out as image-replacement documents, which are run through its standard check-processing system.
The Arizona banking company has already processed $10 million in remote-capture deposits, Ms. Scheer said. Other First National commercial clients are also testing the system, she said.
The company “had a very aggressive mission to get this out to market sooner rather than later,” Ms. Scheer said. “Building the infrastructure in-house would have really put us off our time line,” she added. Because it is using the hosted service from NetDeposit, “we’ve not had to change anything in our back office.”
Danne Buchanan, NetDeposit’s chief executive, said the service should help it reach beyond the nation’s top 20 banks, which are now the target customers for its software.
Alenka Grealish of Celent Communications LLC in Boston said demand for remote-capture systems will keep growing as corporate customers seek the convenience.
“The companies that feel the most acute pain — like the second in command driving to the bank — will jump on the bandwagon first,” said Ms. Grealish, the manager of the market research firm’s banking group. “We’re definitely in the early stages.”
