1st Source Bank follows customers south and opens branch in Florida

SOUTH BEND — 1st Source Bank is dipping its toe into the Sunshine State with a new banking center in the Gulf Coast city of Sarasota, Fla., home to a substantial number of South Bend area retirees.

The new banking center, the institution’s first outside of Indiana or Michigan, opened on the seventh floor of the Spector Building in downtown Sarasota on April 10.

“It is a regular branch, but not in a traditional sense with a drive-through and teller windows,” said Chris Strafford, senior vice president of wealth advisory services for the South Bend-based bank.

The center accepts walk-in customers from 10 a.m. to 2 p.m. Monday through Friday, Strafford said, but otherwise functions as a private banking hub, with two private bankers — one from South Bend and one from Florida — on staff.

“Deposits, loans — a lot of that we go out to the customer to service them,” Strafford said. “We make ourselves available to them at their place of business or at their home.”

The center also solves a long-standing problem for 1st Source: its inability to establish trusts in the state, which has a friendlier tax policy for trusts than Indiana.

“For years, we have had customers who move to Florida and we’ve introduced them to other banks,” 1st Source CEO Chris Murphy told the Tampa Bay Business Journal in October. “We’ve gotten tired of doing that. We want to be able to provide their banking services in Florida.”

1st Source established the banking center in response to requests from customers, Strafford said, including current and former South Bend area residents who winter or permanently reside in the state.

“We did a whole study of the whole state of Florida,” Strafford said. “We had people all over state, but we found we had a real concentration in the Sarasota area, so that was a natural place to start.”

He identified Naples and Orlando as other possible locations based on the same study, which found more than 1,500 South Bend area natives currently living or wintering in the state.

“We’re not going into Florida to dominate” the market, Strafford said. “But we are looking at the needs of our customers. And as more and more are looking at Florida for their home, this makes for a more seamless approach. They don’t need to change banks.”

As for the need for a physical banking location given the prevalence of online banking, he said, “There are some people who like that, but traditionally a lot of people like to start relationships face-to-face and then take advantage of working with the mobile app or over the phone.”

Depending on the success of the center, the bank could open a more traditional branch with tellers and drive-throughs, Strafford said, or even expand the concept to Arizona, another popular destination for area retirees.

Whether it’s common for banks to follow their customers south in retirement is not clear. The American Bankers Association is not aware of any specific data on the subject.

At the same time, “Banks continue to use innovative strategies to expand their reach and enhance customer relationships,” Mike Townsend, a spokesman for the trade group, said in a statement.

“Customer service and convenience are paramount for consumers,” Townsend said, “and this is an example of a bank finding a way to maintain trusted relationships with existing customers by being where they are.”

eblasko@sbtinfo.com

574-235-6187

@ErinBlasko