CLEVELAND, OHIO – Any credit unions looking to expand their members' access to surcharge free ATMs are more than welcome at Key Bank, a bank executive said. The $85 million Midwest based bank has signed up 22 credit unions in its Surcharge Free ATM Network last year and anticipates having 50 credit union participants by the end of the year, according to Brian Sismour, National Sales Manager for Agent Banking for Key. "Our first year was spent mostly educating financial institutions about us and what we offer," said Sismour. "In 2002 we began to sign up firms for the program," he said. The bank has signed up 23 community banks in the same period, Sismour added. Key's main attraction for credit unions is its large "footprint" in the Midwest, Sismour explained. In the areas where the bank has a lot of machines, credit unions can easily, rapidly expand their credit union members' access to ATMs, he explained, and that can be particularly attractive to mid-tier credit unions who might not have many machines or even any at all. "Most of our credit union members have at most a handful of ATMs," Sismour noted and yet they have members with ATM cards who are getting surcharged as foreign users at other firms' ATMs. "We offer credit unions a way to change that," he said. Sismour used one of the member banks as an example. Before a credit union joined the network, he pointed out, its members might use a member bank's ATMs all the time and pay $2.00 per time to do so, he noted. But after joining Key's Network, the member can use the same ATM for no surcharge and with the credit union paying a small fraction of the surcharge. Sismour would not say how much the transaction fee was but reiterated that it was "only a minimal fraction" of the surcharge the credit union member would face otherwise. He also pointed to the bank's policy of not basing its charges on transaction volume. "We are very proud of our flat rate," he said. Small credit unions will not pay a larger transaction volume just because they are small and don't have the volume, he said. That is Key's interest in the Network, Sismour said. We want to provide credit union members as many chances to use their ATM cards and generate transaction volume for us as possible, he added. The bank backs up that sentiment with hard marketing support as well. Credit unions that sign up with the Network get posters, lobby signs, table signs and other materials advertising the opportunity to use more ATMs, Sismour said. "And none of the materials say `Key Bank,' he said. "All they have is one of our logos, very small, somewhere on the piece," he said. What about CO-OP Network? Sismour admitted that Key's interest in signing up credit unions to be part of their Network might appear to put the bank in competition with CO-OP Network, the Concord California credit union owned Network with a nationwide presence. But he maintained that the firm didn't look on CO-OP Network as a competitor. "There is no exclusivity clause in any of our contracts," Sismour said. "If a credit union wants to join CO-OP Network as well as Key," he said, "we say more power to them." Sismour admitted that a credit union, for example, might have members who traveled to regions where there are a lot of CO-OP Network affiliated machines. "If that credit union wanted to join CO-OP Network as well as ours, we don't have any problem with that," he said. However, none of the 22 credit unions that have signed up with the program are CO-OP Network Members, according to the firms' sites on the World Wide Web. No one from CO-OP returned calls by press time. One of most significant differences between the two Networks is that the Key Network is not reciprocal, whereas CO-OP Network is. A credit union that has a few ATMs, for example, and which is part of the Key Network will still be able to collect income from Key cardholders even though it is part of the Surcharge Free Network. That effectively means the credit union which might be collecting surcharge income from the many Key cardholders doesn't have to give up that income when they join the Network, Sismour explained. By contrast, a credit union that might join CO-OP Network would have to commit to not charging network members surcharges, even though many of them might use its ATMs. But doesn't that arrangement annoy the Key customers who also don't like surcharges? "We think they are pretty well represented," Sismour said. After all, they are not charged for using any of the relatively many Key bank machines, he added. Elcose Federal Credit Union, a $15 million institution based in Elkhart, Indiana doesn't have ATMs for its 6000 members, but did issue them ATM cards which used to bring them frequent surcharges said Tom Francis, CEO of Elcose. "In our member surveys we regularly heard from our members about wanting to have surcharge-free access," Francis said. "A lot of ATMs in the area were affiliated with Key and so when Key offered access, we went with it," he said. Joining the Surcharge Free Network allowed Elcose to give members in the small town of Bristol, Indiana, ATM access that it would not have been able to otherwise, Francis said. About half of the credit union's 300-400 ATM transactions per month are Key transactions, he reported. [email protected]

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