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Indian American owned community bank
Expatriate Varghese Chacko is now set to open the first Indian American-owned community bank in Illinois next month.
After running a successful direct mailing business for several years, expatriate Varghese Chacko is now set to open the first Indian American-owned community bank in Illinois next month.
The bank, established with eight Indian Americans on its board of directors, is to have an initial capital base of $8 million and will offer services beyond traditional banking.
Chacko, who came to the US as a student over three decades ago, earned an MBA from Roosevelt University. While working in the catalogue distribution department of Montgomery Ward, it occurred to him that starting a direct mailing service would be a profitable idea. So he established Prompt Services in 1985.
Prompt Services, which began from Chacko's garage with one employee, today has 40 staffers and operates from a 40,000-sq ft office in downtown Chicago. "Direct mailing is big business," said Chacko, "you have to focus on the right segment."
Chacko today counts among his customers SBC, Chicago Tribune and Cingular Wireless.
The bank, to be called the All American Bank, will be a "friendly community-owned bank offering personalised banking", said Chacko.
"Part of the vision of a community bank is to help the community. We intend to offer help with the Family Trust Fund, taxation advice and how to purchase a franchise. Many Indian Americans are buying businesses but they are not trained properly (to run it)."
Chacko said the bank would also have a 'travel club' where it would buy air tickets for customers who have to travel abroad in an emergency.
"If there is a death in the family, for instance, the bank will arrange the ticket for its customers who can repay in monthly instalments later."
For Indian American home owners in Chicago who want to build a house in India, Chacko said the bank would pay the builder in India against the customer's home equity in Chicago.
The All American Bank will also help channel money from government agencies for Asian Americans, Chacko said.
"At present, other communities like African American and the Hispanic community get this money. Asians too should get their fair share," he added.
Chacko is the chairman while a Korean American is the chief operating officer. Other staffers will come from members of the Asian community. The Federal Deposit Insurance Corp recently gave the bank approval to open for business.
Chacko sees a big market in the Indian American community for the bank's services. He noted that Indian Americans were good customers.
"Indian Americans pay their bills on time. Over 10.2 per cent of the population of Des Plaines (a Chicago suburb where the bank will be headquartered) is Indian. In 4.6 km radius from the bank, there are more than 32,000 Indian Americans over the age of 18."
Chacko said that unlike business owners from many other minority communities, Indian American business owners "have financial stability. This puts them in a better position to acquire and run a business".
The secret of Chacko's success is, besides hard work, "the use of the common sense approach. I have been exposed to corporate America right from the beginning. I feel Indian Americans should look beyond the retail business and gas stations".
Chacko is also the current president of the US Pan Asian American Chamber of Commerce, Midwest chapter. One of the objectives of the chamber is to expand the market for Asian businesses by connecting them with American corporations.
