- The Washington Times - Friday, June 11, 2004

Riggs Bank NA, which plans to abandon its lucrative international banking business in the fall, is trying to lure new customers in the Washington area with perks such as free checking and longer hours at its branches.

The bank is in the midst of an elaborate advertising campaign that casts itself in a populist light.

“Hardly anyone is making money on the Internet. Why should we?” reads one of the print ads.

Another declares, “Your mattress can hold your money. Your bank should do more.”

The ad campaign was conceived in the fall, according Riggs spokesman Mark N. Hendrix. “It had nothing to do with subsequent announcements,” he said.

Riggs National Corp., the bank’s parent company, disclosed in a securities filing in March that regulators were considering fining it for lax compliance with federal anti-money laundering laws.

The next month, Riggs — under pressure from regulators — announced plans to get out of the international banking business by late September.

International banking, including accounts with many of the embassies in Washington, comprises roughly one-quarter of the bank’s total deposits, or about $1 billion.

On May 13, Riggs agreed to pay a $25 million fine for failing to report suspicious activity. The government’s investigation concluded that Riggs, over at least two years, failed to monitor suspicious transfers through Saudi Arabian and Equatorial Guinean accounts it held.

The company agreed to pay the penalty without admitting or denying any wrongdoing.

Two weeks later, Riggs said it would listen to offers to buy the company.

The bank’s advertisements — including spots in newspapers and train stations and on buses and the radio — began April 19. Mr. Hendrix declined to say how much the campaign has cost.

The ads tout the 168-year-old bank’s latest perks, including free checking and online banking and longer weekday hours and Sunday hours at some branches.

The bank has experienced “an uptick” in new customers since the campaign began, Mr. Hendrix said. He declined to specify by how much.

The ads are part of the bank’s broader effort to increase its domestic banking division, Mr. Hendrix said.

Riggs operates about 50 branches, all in the District, Northern Virginia and Maryland. In the last two years, it has redesigned several branches, adding comfortable chairs, television sets and providing customers with free Internet access.

It also added a Starbucks coffee shop to one of its downtown Washington branches.

“They are trying to remake themselves as a community bank with a retail focus. One would have to question if this leadership has the capacity to manage this kind of transformation,” said Gary B. Townsend, a banking analyst for Friedman, Billings, Ramsey Group Inc., an Arlington investment brokerage.

Bert Ely, an Alexandria banking consultant, said Riggs’ efforts might be too little too late.

“You don’t strengthen your presence overnight. Riggs should have been doing this in the ‘80s,” said Mr. Ely, who predicts the bank will be sold within a year.

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