Irvine-based investment banker Richard Waterfield and his brother Randy have launched National InterBank.com, an Internet-only bank that hopes to lure depositors with no-fee services.
With no brick-and-mortar branches to support, National InterBank offers free checking accounts, money market savings accounts, online bill payment, no-annual fee credit cards, cashiers checks, ATM/debit card replacement, no deposit requirements and refunds of up to $6 per month for ATM charges.
Waterfield said the bank only charges for bounced checks and wire transfers, but he expects to wipe those out in the next few months with some relationships the bank is developing.
“We want to make money the old-fashioned way: off the spread,” Waterfield said.
The bank does support a call center in Indianapolis and its corporate headquarters in Irvine.
National InterBank has already attracted about 6,000 accounts and is preparing to launch an aggressive marketing campaign.
The bank is headed into rough seas, though. Some of the Internet banking sites have had account attrition rates as high as 50%, related mostly to difficulty of use.
Waterfield said that his group has learned from others’ mistakes and incorporated those lessons in its organization.
The bank has already raised $10 million to get the venture started and is looking for a $40 million to $50 million venture capital round this summer. “If we meet our growth projections, we’ll have to go public in December,” Waterfield said. “We’re more comfortable in a public environment.”
The two brothers are former Goldman Sachs employees. Richard was an institutional equity advisor and Randy was an asset manager, responsible for the $1 billion small capitalization portfolios. They are also partners with David Fife in Fife Waterfield & Co., an investment banking firm in Irvine.
Richard Waterfield and Fife maintain the OC office, while Randy Waterfield heads the New York office and handles relations with Wall Street.
The bank was developed through partnerships with technology companies. National InterBank teamed with S1 to develop the software for the banking site in conjunction with NCR, the hosting facility. M & I Data Services set up the bill payment system, and Bisys handled the processing systems and is housing all the customer data and transaction analysis. The bank is also working with Anderson Consulting on developing software that will analyze customer financial needs. The bank also has partnerships with MAC ATM Networks and offers mortgage, auto, and home-equity loans through E-Loan.
And the bank is looking to put more financial services on the site, including a stock brokerage service.
“We have so many great companies that want to partner with us,” Waterfield said. n
