NatCity Competitors Try to Woo Customers

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National City bank insists it's still well-capitalized and that its investments, deposits and mortgages are safe. But with all the headlines about National City's exposure to subprime loans and its precipitously falling stock price, competitors spotted an opportunity.

One of the most aggressive is the much-smaller FirstMerit bank, which is based in Akron. It's taken out full-page newspaper ads touting sound lending decisions and better business practices. The ad never mentions National City but, presumably, readers are expected to remember all the bad press and pick FirstMerit instead. At least that's the intent.

KOLBE: The fact is that's not how someone reading that ad may respond to that.

That's Richard Kolbe, a marketing professor at Kent State University. He says this kind of ad could backfire for banks like FirstMerit, instead leading to the impression that they have something wrong.

KOLBE: Is this bank in trouble and they have to convince us they are strong? When people see advertising from banks, they may make that judgment on that.

However the public reacts, Kolbe says, given that banking is not a growth industry, it's not surprising competitors are trying to steal market share away from their beleaguered peers.

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