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This is one big box community bankers consider a gift.
Warehouse club Costco Wholesale started partnering with banks to offer mortgage services online last year, and it wants to get into auto lending and, perhaps, student loans.
Banks-especially small banks-fear head-on competition with big-box retailers. Wal-Mart Stores and Target have jumped into financial services with offerings like debit cards, check cashing and mobile wallets.
Costco's partners on mortgages are five community banks and four small mortgage lenders. The lead partner is $669-million-asset First Choice Bank of Lawrenceville, N.J.
Costco has not decided when it will start offering auto loans, or if it will introduce a student-loan service to its 64-million-strong membership base.
In either case, Costco will partner with banks or credit unions, said Jay Smith, director of financial services.
In perhaps the most unusual twist to Costco's foray into banking, Costco receives no financial compensation from any of the banks in its mortgage partnership.
"We don't pay anything to Costco," said Bill Blanton, the chairman and chief executive of the...