ALBANY, N.Y. – When the $387 million Sunmark FCU signed with KeyCorp to give its members surcharge-free access to 290 ATMs in New York State in early April, the credit union validated both KeyCorp's ongoing surcharge-free ATM strategy as well as a change in focus in how the bank markets its ATMs. "Essentially we are a northern tier bank," said Brian Sismour, sales manager in KeyBank's agent banking program which runs the surcharge-free network. "We run more or less from Maine to Alaska," he said, "but not so much in the Southern tier." Indeed, Keybank's ATM fleet has remained essentially static at 3,100 machines, 2,200 proprietary machines across the northern states and 900 Wachovia machines that are marked with the brand of Southern Trust, a network which Wachovia purchased. Instead of adding more machines, KeyCorp has sought to market itself more heavily to financial institutions which are already in the area where KeyBank has machines, offering them less the burst of nationwide machine access and more heavy local access which can appeal most strongly to many credit unions whose fields of membership are often geographically limited. For example, Sunmark's field of membership extends to four counties in the Albany area and the credit union sought a way to provide its members with greater surcharge-free access around the state, where most of the credit union's members are most likely to be. The credit union already belongs to SUM, the NYCE Network's surcharge-free network but wanted to supplement its ATM fleet which already consisted of nine machines, according to Bill Jenkins, Sunmark's director of marketing. "Our partnership with Key Bank allows Sunmark members to have a broader range of services at their disposal in the Capital Region and beyond," said Sunmark CEO Bruce M. Beaudette. "This continues our mission to enhance our members experience and provide the best financial opportunities available." KeyCorp has also stuck with its strategy of offering non-reciprocal ATM access. Instead of reciprocal ATM network options in which network participants agree not to surcharge each other's cardholders, KeyCorp's non-reciprocal arrangement allows the credit union to continue to surcharge foreign ATM users and pay a transaction fee to KeyCorp for each time one of its cardholders uses a KeyCorp machine. This allows a credit union to continue its revenue stream from its own ATMs and decide whether or not it will pass on the surcharge to all its members. Some credit unions using the KeyCorp network pay the surcharges for a member's first three ATM transactions per month and then charge for additional transactions or offer completely surcharge-free access to members who maintain a certain balance level. "Our members have the freedom to structure their ATM policy as they like, and many do," Sismour said. The two approaches, marketing primarily within its existing geographic footprint and offering the non-reciprocal approach have helped the ATM network grow to 140 participating institutions since starting up roughly two years ago, and now that bank has begun to integrate its marketing across all of its divisions Sismour hopes it will continue at a good pace. Thomas Geisel, a bank vice president who doesn't work in the agent bank program was responsible for initiating the Sunmark addition, Sismour said. -

[email protected]