ATM Fees Revaluated After Large Banks Boost Theirs
ELKIN, N.C.–The decision by several large banks to boost ATM fees for noncustomers has prompted other institutions to rethink their own ATM policies.
Yadkin Valley Financial Corp., here, for example joined the Allpoint network as a way to give its customers free access to more ATMs in the wake of Bank of America and other large competitors’ hiking their surcharge fees to $3, according to American Banker, a CU Journal affiliate.
Some community banks that previously reimbursed customers for surcharge fees to mitigate large banks’ advantage in the ATM arena have found it is too expensive to continue that policy, the report noted. “Some banks that” chose “to go all surcharge-free all the time are now coming back to us and trying to decide how to cut back on their expense, because that’s like a bleeding artery,” MoneyPass CEO Doug Miraglia said.
Zions’ Calls Tightening Of Underwriting ‘Silver Lining’
SALT LAKE CITY–CU foe and Zions Bancorp Chairman Harris Simmons said the silver lining to the credit crunch is that it will force lenders to tighten their underwriting standards.
“In the short term it’s going to create some pain, and in the long term, for traditional balance-sheet lenders, it will create a lot of opportunities,” Simmons told American Banker, an affiliate of CU Journal.
Moreover, the current market conditions should create better pricing and better alignment of pricing to risk, Simmons added.
Zions reported its net income fell 70% in the fourth quarter to $24.2 million.
State Banks May Be Able To Branch Easier In SD
PIERRE, S.D.–The South Dakota Banking Commission has crafted legislation that would allow state-chartered banks the same authority to branch within the state as their national bank counterparts.
CU Journal Affiliate American Banker reported the state regulator wants to streamline the branching process for state banks, which currently requires them to go before the commission to get approval for branches. Under the proposed law, state banks could submit their a branch application directly to the director of the commission and could appeal the director’s decision to the commission. Additionally, banks would no longer have to prove a need for additional banking access in the community, though they would still have to prove they were well capitalized and able to serve the community.
BankUnited Plans To Cut Expenses, Shift Focus
CORAL GABLES, Fla.–Here at the epicenter of the mortgage crisis, BankUnited Financial Corp. said it plans to cut expenses and shift focus to commercial lending and non-mortgage products. The thrift told CU Journal affiliate American Banker that it plans “to reduce in size and to some degree dependence on the residential area as we refocus our direction to the retail commercial bank.” BankUnited has already closed four of its nine sales offices and consolidated nine operations centers to three.
Sovereign Bancorp Forced To Do Away With Dividend
PHILADELPHIA–While credit unions across the country have reported a variety of dividends and bonuses for their members, at least one bank has had to do away with its quarterly dividend for shareholders. Sovereign Bancorp said the move was part of its effort to strengthen capital and mitigate risk in the wake of the economic shakeup. The $84.7-billion Sovereign reported a $1.6-billion fourth-quarter loss.
CFSA Finds Payday Loans Helps People In Crisis
FAIRFAX, Va.–A controlled experiment at a university using 318 subjects in a simulation of the conditions a cash-strapped consumer would face has found that “access to payday loans improves the borrowers’ ability to survive financially”–to a certain point.
The results were released by the Community Financial Services Association of America, a trade group that says it is “dedicated solely to promoting responsible regulation of the payday advance industry and consumer protections.”
The study was conducted by a team of researchers from George Mason University and Colby College said they found because “payday loans can help the participants to manage their personal finances better, the availability of payday loans–despite their high cost–improves consumer welfare in the study by allowing borrowers to deal with unexpected expenses.”
“However,” the authors said, “borrowers whose demand for payday loans exceeds a certain threshold level are at a greater risk than those who do not have access to payday loans.”
CFSA said that among the conclusions was that access to payday loans in their environment, all else fixed, increases a borrower’s probability of financial survival by 31%. For info: http://papers.ssrn.com/sol3/papers.cfm?abstract-id=1083796.
