nwa330

I would say this is bigger news then a trip report to El Paso.

mersk862

That being said, US Bank has quite a few branches in the Minneapolis and Memphis markets, where a large base of NW customers lived (not to mention branches in a lot of Heartland markets from Ohio to the Rockies - a place where NW had a lot of stranglehood; though Michigan is not one of their markets). Point being, US Bank was convenient for many NW customers.

SunTrust doesn't really cover many of Delta's markets. Sure, it covers all the Southeast. But for customers in the Northeast (where Delta is rather large), Midwest (think all those NW customers in the Heartland, plus all those that used Delta and CVG), plus those in the Rockies, plus those in the LA Basin - all markets where DL has a substantial presence - won't really be able to benefit from a SunTrust checking account unless they want to do long-distance banking and pay ATM fees for using other banks ATMs. Simply put, having only SunTrust doesn't add a whole lot of value for a lot of DL customers without having a degree of difficulty.

motytrah

U.S. Bancorp has locations in Arizona, Arkansas, California, Colorado, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Minnesota, Missouri, Montana, Nebraska, Nevada, North Dakota, Ohio, Oregon, South Dakota, Tennessee, Texas, Utah, Washington, Wisconsin, and Wyoming. It also has operations in Canada and Europe.

NW also had a DTW bank based with a debit card product to ensure all hubs had debit card availability.

Obviously DL and US Bank have burned bridges. It doesn't matter that US Bank already covered pretty much every state DL and NW had hubs and focus cities. Not going to happen. I don't advocate going back to US Bank hat in hand.

Sun Trust might make a good regional partner, but DL needs to add more banks if they want to maintain the existing service level.

sxf24

Who said an announcement with US Bank for new consumer products isn't forthcoming?

nwa330

Beacause it's not. Suntrust has got it.

sxf24

I wasn't aware DL was looking for an exclusive partnership for debit cards. Is that what will be announced with SunTrust?

motytrah

The issue with a US Bank deal would be that they are in many of the same states Sun Trust is. Once you have a small regional like Suntrust you run into issues with larger banks like a US Bank, Wells Fargo, etc. But there are certainly no shortage of regional banks. For classic NW hubs you could do a TCF, maybe an M&I. There's certainly a number of options on the east and west coast to boot.

GUWonder

They have had the DC/IAD/BWI area covered in this decade as a result of the acquisition of Crestar, but otherwise their coverage in most of the country is minimum -- much like US Bank which has very little to no retail banking presence in most of the states along the Atlantic, Pacific coast and Gulf of Mexico.

mcjava

US Bank doesn't have coverage in WA, OR, CA (Pacific coast)?

GUWonder

Of course it does to some extent or another with retail banking in those three states, but that still doesn't constitute most of the states that are along the Atlantic, Pacific and Gulf of Mexico. Or is different than and , so perhaps there should have been consideration for why and was used.

mcjava

It was a simple question.

Upon further analysis of your statement, I wonder what was the purpose of even including the word Pacific? While technically the statement is true, most likely many people who read it understood it to mean US Bank has no presence in WA, OR, CA, the states that are along the Pacific, when in reality US Bank does.

GUWonder

One that was answered in my earlier post.

If that's how some would (mis-)understand it, then I would ordinarily think that's their reading issue to resolve.

The reason to focus on the coastal states' retail banking relevance has to do with where the majority of the US population is concentrated and because the overwhelming majority of these consumers are unlikely to use a bank debit card unless the bank operates very near their place of residence.

If you want to drill even further down into US Bank's retail (consumer) banking relevance in the coastal markets -- even in just the Pacific coast states -- then go ahead and do so and see where it leads you. US Bank is certainly not a leader in retail (consumer) banking in most of the states along the Atlantic, Pacific coast and Gulf of Mexico. They would barely crack into fourth place in California even after their acquisitions there last year.

First Star-US Bancorp have national ambitions but that's a product of their management recognizing that even after becoming the 6th biggest player in some terms they are still not a leader in the coastal states where most of the US population is around. I wouldn't be surprised to see the brothers or even an Amex potentially desperate for retail deposit network to try to take out Suntrust in order to get more of a national presence. Nor would I be surprised if Delta does debit card deals with more banks than it has done in the past.

3Cforme

There are many successful card products launched in the absence of a big retail branch network. SunTrust has the Delta name - and SkyMiles and WP mailing lists - behind it. We could all study the success of Capital One.

It's not USBank. It's not MSP based. So long as SunTrust has the infrastructure to handle the volume of new accounts this is no big deal.

motytrah

This is a debit card product, not a credit card product. It implies people would want to make deposits to fund accounts. While a lot of stuff is ACH these days, there's still a need to have Branch or at least ATM depository access for most people. SunTrust will have neither in most of DLs hub and focus cities.

Denolloyd

That's a great point. IMO, Delta would have been better served by partnering with a Bank with a large national footprint. JPM, Citi, or BOA comes to mind. Although I will certainly benefit from a Suntrust DL Card by living in FL, I can see where a large number of DL's customers will have an issue. If it was a Credit Card, this issue would be irrelevant.