Short Interests

Hispanic market an opportunity

Aaron Siegel
306 words
28 March 2005
Investment News
INVN
6
Volume 9; Number 12
English
(c) 2005 Crain Communications, Inc. All rights reserved.
NEW YORK - The Hispanic market is emerging as a growing demographic, and the financial services
industry is taking notice.
The Hispanic Market Monitor, produced by SYNERGISTICS Research Corp. in Atlanta and released on
March 1, examines the attitudes and financial services profile of Hispanics. The survey found that this market
offers a major opportunity for financial institutions.
The survey found that a significant portion of the Hispanic population uses checking accounts (82% of those
born in the United States and 64% elsewhere), home mortgages (58%; 22%) and investments (44%; 10%).
However, CDs (23%; 11%), IRAs (25%; 8%) and MMAs (16%; 8%) have yet to catch on.
Hispanic purchasing power has more than tripled in the past 15 years, while U.S. buying power has gained at
half that rate. It is expected to grow 89% to $926 billion from $491 billion between 2000 and 2007, according
to The Selig Center for Economic Growth at the University of Georgia, which has projected that growth rate
despite lower usage of banking services among this segment compared with the general population.
``Financial services have to target this market segment very specifically and very cautiously,'' said William
McCracken, chief executive of SYNERGISTICS. ``They can't expect to capture this market the same way
they capture the general population.''
The survey found that cultural characteristics and specialized needs must be addressed when working with
this market segment. For example, many Hispanics use check-cashing centers and Hispanic banking
institutions to fulfill their financial needs.
The data were compiled in a national telephone survey conducted in October and November with 1,000
telephone interviews with self-identified Hispanic consumers conducted in Spanish or English, based on
respondent preference.
Big contrast: Financial services usage by 1,000 Hispanic respondents Stewart Turner * Source:
SYNERGISTICS Research Corp.
Document INVN000020050401e13s0000r

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