Asian American Bank & Trust Co. will open its fifth branch this year in a location that was too good to pass up – inside a new Asian supermarket in Dorchester. The Boston-based commercial bank has opened about one branch a year since receiving its state charter in 1993, and has grown to $65 million in assets.
Dorchester has many Asian immigrants, particularly Vietnamese, and there are also many ethnic groups there, said Vivian Wenhuey Chen Huang, the bank’s president and chairman.
The bank’s first supermarket branch, expected to open March 1, could also give Asian American Bank exposure outside its target market. While the new Super 88 Supermarket will attract Asian customers, many other people will go to the store looking for hard-to-find food products, she said.
While the bank formed to serve Greater Boston’s Asian-American community, as it has grown it has reached out to other underserved populations in the city, adopting the motto The Bank That Serves All Nations. The bank operates two branches in Boston’s Chinatown neighborhood, and opened an Allston branch in 1998 and a Somerville branch in 1997.
Because there is a need for our kind of services, we have many communities begging for our services, Huang said. We have to grow in a planned fashion … but when a [suitable] location comes up, we just cannot let it go.
Reaching Out
Asian American Bank must balance the need to open branches in neighborhoods where its target customers live and work with a conservative approach to growth. It is costly to employ multilingual staff and print materials in several languages.
We hope to be able to open roughly one branch every year to reach out to communities, Huang said. On the other hand, we have to be conscious of profits. When we open new branches, profits come down because of overhead cost.
In the first few months of the year, the bank will add bilingual staff to meet the needs of other customers, including Portuguese speakers in Somerville and Russian and Yiddish speakers in Allston. The bank’s branches already have employees who speak Vietnamese and several dialects of Chinese.
The banks automated teller machines allow customers to choose between conducting transactions with English and Chinese or English and Spanish on the screen.
The potential is huge, Huang said. Even though this is not a huge Asian community the way California or New York is, there are still a lot of Asians here.
The Asian and Pacific Islander population in the Bay State has increased substantially in the 1990s, rising to 222,965 in 1998 from 146,030 in 1990, according to figures from the U.S. Census Bureau. The 52.7 percent increase placed Massachusetts tenth among U.S. states with the most Asian residents in a 1998 ranking.
In the Boston metropolitan statistical area, the 1990 census reported 27,084 Asian or Pacific Islander households, making the city the fifteenth most heavily populated by those ethnic groups. Asians made up 2.5 percent of all households in the area, and 39.2 percent owned homes, the census reported.
Market Potential
Some traditional banks have started to actively market to underserved populations, including minorities and recent immigrants. Huang said she has noticed the change in the last two years.
Three years ago I didn’t see that kind of phenomenon, she said. They certainly see the market potential here.
The most visible of these is Citizens Bank, which recently launched a pilot program to help immigrants in Massachusetts obtain mortgages and buy homes. The New Citizens Home Ownership program, a partnership with Fannie Mae, will make $10 million in mortgage money available through Citizens Mortgage Corp. offices in Boston, Jamaica Plain, Woburn, Quincy and Cape Cod.
Citizens Bank has grown in large part as a result of our ability to do business with newcomers, said Citizens Financial Group Chairman and CEO Lawrence K. Fish. In our branches we speak 42 languages to our customers and employ a growing number of immigrants. This program is our opportunity to provide prosperity for a vital community which is so important to the economic growth of our region.
Despite the attention some larger banks have given to the market, Huang said Asians and other underserved markets are attracted to Asian American Bank not only for its language capabilities, but because employees understand their culture.
They certainly are trying to get some inroads into this community, but we feel we understand the culture from the top down, she said. Everyone in this bank understands this culture. It makes banking with our bank different from just banking where a few people have the language capability.
In addition to growing the bank’s branch network, Huang plans to expand the full-service commercial bank’s product offerings. In the next 90 days the bank will upgrade its Internet banking products, and at the beginning of the year it will offer customers insurance products through Savings Bank Life Insurance. At a later time, the bank will expand its insurance offerings and offer mutual funds, she said.
