PNC Bank will pay the University of Kentucky’s sports marketing partner $8.6 million over the next 15 years to become the school’s “official” bank, with unprecedented access to its 30,000 students and 12,000 employees. Under the deal, UK will receive 70 percent of those payments.
According to the contract between PNC and JMI Sports, which the Herald-Leader obtained under the state’s Open Records Act, PNC will get a list each year of employees and students who have not opted out of the school’s directory information, allowing the bank to send mailings. PNC will be the only bank allowed to promote itself on campus and will have access to UK’s intra-campus email for distribution of PNC literature.
PNC also will set up seven ATMs around campus, including in the new Student Center, due to open in 2018, where the company will build a 645-square-foot fnancial services office.
The contract allows the UK Federal Credit Union to keep two ATMs and branch office on campus, but it cannot have any presence on the first floor of the new student center. UK is terminating lease agreements for a credit union ATM in Kirwan Hall, and with BB&T and US Bank, which have ATMs in Bowman’s Den.
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The UK Federal Credit Union was started in 1937 by UK College of Agriculture employees, and it has five offices around town, including a main office in Hamburg. Credit Union officials did not return calls seeking comment Tuesday.
According to the contract, PNC will pay JMI a one-time signing bonus of $250,000, and then give the agency yearly payments that start at $450,000 and increase to $645,000. UK will use $75,000 from its yearly payment to support the UK MoneyCats Education and Coaching Program to promote financial literacy.
PNC will make a one-time payment of $125,000 directly to UK for a “re-carding allowance,” which will allow students to use their UK ID card as their PNC debit card.
UK will receive 70 percent of PNC’s payments to JMI Sports, most of which will be used to address budget needs, spokesman Jay Blanton said.
The contract includes language that allows both parties to renegotiate on the fifth and 10th years, depending on how lucrative the deal has been. For example, if the number of accounts opened is less than 90 percent of 2,727, PNC can start renegotiating. If it’s more than 110 percent of 2,727, then JMI can start talks.
The contract states that the program “is designed to attract constituents that do not have an account with PNC Bank,” but the bank is prohibited from soliciting students to open credit card accounts.
In 2014, UK signed a 15 year, $210 million deal with JMI for all its athletics multimedia rights, but that contract included “campus rights,” which allowed sponsorship deals outside of athletics, including the one with PNC bank. Officials have said that deals such as this one will help shore up financial support for UK in the wake of numerous state budget cuts.
Paul Archey, president of JMI’s offshoot, UK Sports and Campus Marketing, said Tuesday that more deals will be announced in the near future.
“It’s an ongoing effort,” he said.
Athletics marketing has gone on for years, but campus rights are fairly new to higher education. “We’re certainly trying to lead that effort,” he said.
Central Bank remains the “official” bank of UK Athletics.
A statement from PNC focused more on education than thousands of new customers.
“Financial education is crucial to a student’s future, and PNC is committed to helping create educated consumers,” said John L. Gohmann, PNC Bank regional president for Lexington in a news release announcing the partnership. “This new relationship will allow students to make smart and responsible banking decisions, with PNC tools and knowledge to achieve long-term fiscal success.”