SALT LAKE CITY – With its Utah application to open an industrial bank in limbo, Wal-Mart Stores Inc., is now busy disputing claims by a Boston consulting firm that it might eventually evict bank and credit union branches from many of its U.S. stores. The charge that Wal-Mart might force financial institutions out the door of its stores once it receives approval for its Salt Lake City bank was advanced in an October study, entitled, "What's in Store for In-Store Branching," issued by Celent, a financial consulting firm. In the report, author Bart Narter, a Celent analyst, casts doubt on Wal-Mart's future intentions in retaining banks and CUs as "tenants" in its stores, contrasting the giant retailer with Safeway which looks at financial institutions as strategic partners. The report, quoting Wal-Mart officials, said the retailer currently has 1,100 in-store branches with another 300 in the planning stages, many to be located in its Supercenters. Credit unions in Florida, Ohio and Wisconsin and elsewhere report success and heavy traffic from Wal-Mart store branches, many of which were locked up in contracts with the retailer years ago. For its part, Wal-Mart insists it has no intention of getting into the retail banking business and, moreover, its bank/CU leases are for 15 years and renewable at the option of the financial institution every five years. In addition, said a Wal-Mart spokesman, "they can only be canceled by the bank or credit union tenant." The spokesman stressed that its Utah application is narrow in scope and the bank will serve as a processor for its 140 million credit and debit card transactions carried out at the company's stores each month. In an article on the Celent study appearing in the Salt Lake Tribune Nov. 17, Narter is quoted as saying the retailer's financial tenants lack real power. "Wal-Mart is known for squeezing its suppliers and structuring every deal it does to its own advantage," he said. The loudest objections to the Wal-Mart application has come from the Independent Community Bankers of America which maintains the retailer intends to use its Utah bank to offer savings accounts, auto loans and other services – products that if provided though a Wal-Mart bank branch could impact small banks and CUs. The Celent report cited what it says is evidence that Wal-Mart has other designs for its Utah bank based on its branding activities with NBC/SunTrust bank in "Wal-Mart Money Centers" and its work with GE Money Bank to issue Wal-Mart credit cards. It is clear, said the Celent report, that the primary role of the Utah bank is to process payment transactions "but there is nothing in the public part of the application that precludes Wal-Mart" from selling CDs, opening branches and competing outside metropolitan Salt Lake. "One sees Wal-Mart moving forward methodically, testing the concept with other banks, testing its own brand and offering limited services," the Celent report concluded. As for its application now pending with the state for four months, the Utah Department of Financial Institutions, which regulates both banks and CUs, said the application is still under review and awaiting more data from Wal-Mart. The Wal-Mart spokesman said the Bentonville, Ark.-based retailer has been trying to cooperate with the department adding "we just want a fair review." [email protected]