BankThink

The moral protest over the idea of bank bailouts has made its way into the court system. A lawsuit filed yesterday in Illinois charged Wells Fargo with violating fair lending laws by lowering a home equity borrower’s line of credit based on an unsubstantiated appraisal of his house. The complaint is a class-action suit representing all of the home equity borrowers who were similarly hit with reduced credit lines, but it also appeals to a vaguer sense of inequity with a passage highlighting Wells Fargo’s $25 billion share of handouts from the Troubled Asset Relief Program.

WEST PALM BEACH, Fla. – What will the nation’s credit union community look like 100 years from now? Will there even be one? Or will it be even more robust?

Last night The Bank Lawyer--blogger Kevin Funnell--offered a theory about why the Independent Community Bankers of America is supporting the Federal Deposit Insurance Corp.’s plan to raise capital requirements for private equity investors buying failed banks. He said it seemed that the ICBA expected the rule-change to steer more private equity firms toward stakes in troubled-but-still-standing institutions. Would it work? Funnell didn’t think so. But private equity bidders may find deals with still-operational banks to be sweeter and easier to get.

We almost feel sorry for the guy. As a frequent witness on the Hill recently, Treasury Secretary Geithner has already spent hours and hours answering softball questions with no good follow-ups. Now he faces hundreds more—from the readers of the Wall Street Journal. Turns out the WSJ readers who sent in questions aren’t much more curious than Congress is. They certainly aren’t any more focused.

Today American Banker is reporting that banks are worried they’ll face excessive scrutiny by the new proposed consumer products regulator compared with other types of financial services providers. In the article, bankers argued that non-bank lenders, such as mortgage companies and payday lenders, which would also fall under the purview of the regulator, would be too hard to identify and track. Examiners would want to stick to what they knew—banks, which would be easier to find and monitor.

He may have violated procedure, but perhaps the Federal Deposit Insurance Corp. ought to give him some special recognition for keeping down costs to the Deposit Insurance Fund: A Seattle-area bank teller lost his job after chasing down a would-be bank robber.

The last year painfully illustrated the dilemma most credit unions have been facing for some time now. Even when financing becomes available, finding qualified individuals is about as daunting of a challenge today than at any time in recent history. The slightest imperfection in a credit report can derail a loan process.

The history of the finance industry has been punctuated with ups and downs, with many of the "downs" providing the necessary impetus for strong organizations to rise to the top. During the recession in 2000, 40% of the organizations that had been top performers fell out of that bracket, leaving a huge void for new organizations to fill.

It's time for financial institutions to demand compensation for doing the work of government agencies. Anyone else feeling a little put out by the raft of regulations and compliance issues we face every day? It's long overdue that we get serious about regulatory effects on our bottom lines and the cost to the member. It is time for a concentrated effort, by the affected, to demand compensation for the efforts we make that are mandated by government, but rightfully the responsibility of government agencies that get off scott free while we do their work.

Core conversions are often long, painful and full of headache-evoking processes, and sometimes just the dreaded thought of it all could end the decision to convert. To ensure a successful conversion, credit unions should follow seven basic steps. Each step requires different documentation and tasks that must be completed before moving to the next step, and quality gates should be included in the conversion process to establish important milestones and ensure completeness.