ShoreBank Affiliate — and Prepaid Advocate — Will Continue Despite Bank's Failure

The Center for Financial Services Innovation, a nonprofit organization that focuses on financial services for underbanked consumers, will continue to operate as usual, despite the Aug. 20 failure of its affiliate bank, ShoreBank Corp.

ShoreBank, a $2.1 billion-asset Chicago community-development bank, closed last week after months of capital and regulatory mishaps. The Federal Deposit Insurance Corp. has sold all of ShoreBank's deposits and nearly all of the assets to Urban Partnership Bank, a newly minted state-chartered bank.

"The nonprofits are not directly affected by the Midwest bank closure," Ellen Seidman, ShoreBank executive vice president for mission and strategy, told American Banker. "They are just going on and moving ahead with total continuity."

The center will not have a new affiliate bank, a spokesperson tells PaymentsSource.

In January, the center informed American Banker its finances are separate from ShoreBank's.  Jennifer Tescher, the center's director, considered the relationship with ShoreBank as a strategic alliance.

The center has published several research reports about prepaid debit card use and consumers' attitudes toward the product. Its most recent research note focused on how e-mail alerts can help consumers better manage finances in the face of a troubling economy.