REGIONAL BANKING Ex-Contender for Top Job At Wachovia Bows Out
Longtime Wachovia Corp. executive Anthony L. Furr announced his retirement amid a corporate restructuring. Mr. Furr, the 50-year-old chief executive of the company's South Carolina subsidiary, had at one time been considered a possible contender for the top spot at the parent company. Furr Jan. 31 19611
The captains of Midwest banking foresee a toughening environment this year, but they say they are up to the challenge. A modest profitability slide also may be in the offing.
Eileen S. Kraus, vice chairman of Shawmut National Corp. and one of the highest-ranking women in banking, was recently reassigned to business development functions outside the company's core markets of Massachusetts and Connecticut. The move has puzzled observers.
Holland's ING Group is again doing what it pioneered in the mid-1980s: trading developing-country debt. "We see ourselves as an emerging-market investment bank" says Lane Grijns, president of its U.S. unit.
19587 WASHINGTON Fed Chopping Premiums By 83% for Most Banks
The Federal Deposit Insurance Corp. proposed slashing premiums to 4 cents for nearly 91% of commercial banks in the second half of 1995. The sharp reduction from the current rate of 23 cents per $100 of domestic deposits will save the industry nearly $5 billion a year. But it also means thrifts will pay six times what banks are charged for the government's backing.
Eugene A. Ludwig, the comptroller of the currency, warned that banks are making riskier loans and charging less for them. The industry, he said, is under "big pressure to reach for risk" as rising interest rates erode earnings.
States have the right to regulate bank insurance sales, a federal appeals court ruled. The decision clears the way for Florida's Department of Insurance to force Barnett Banks Inc. to divest an insurance agency it bought in 1993.
The nation's biggest thrift trade group has changed its name to America's Community Bankers. Known since 1992 as the Savings and Community Bankers of America, the trade group was formed through the merger of the old U.S. League of Savings Institutions and the National Council of Community Bankers.
The banking industry is reacting cautiously to news that the Justice Department is investigating efforts by insurers to block sales of the so- called Retirement CD.
19393 COMMUNITY BANKING $39M Verdict Against Bank in Car Loan Case
A jury has slapped a Mississippi bank with a stunning $38.5 million judgment after finding that it wrongfully charged $9,000 in insurance costs to a car loan customer. The decision against Trustmark Corp. was the first of a series of lawsuits filed on behalf of customers by a local attorney.
Michigan's community bankers are ready to take on all comers as the nation moves toward interstate branching. Big and small banks alike are backing a proposal by the Michigan Bankers Association to push for early "opt-in" on interstate branching.
Reno is one of the most coveted banking markets in the country, a key battleground for any bank with nationwide ambitions. And E.R. Houston's American Federal Savings Bank is at ground zero. The former small-town thrift provides a lesson in how to seize opportunities.
Two Michigan community banks scuttled a $13.5 million merger deal after the smaller one, Thumb National Bank and Trust Co., decided to remain independent.
Acknowledging its inability to raise enough capital to survive, San Francisco's Continental Savings of America has consented to being placed in the federal government's "accelerated resolution" program.
19644 INVESTMENT PRODUCTS A Call to Arms Against NASD's Plans for Banks
The Bank Securities Association is mounting an aggressive campaign to block further regulation of bank-affiliated retail brokerages.
The trade group is urging its members to fight the NASD's recently proposed blueprint for regulating bank brokerages.
The NASD has named Dennis C. Hensley of J.P. Morgan to chair the bank broker-dealer committee it is establishing. Competition for the other 11 slots is hot and heavy.
Mutual fund companies, whose prices have been out of reach for many banks, are beginning to look like more of a bargain.
Kevin Crowe could easily have retired to the castle he owns in Ireland after the recent sale of Essex Corp., a leader in marketing annuities through banks. But taking it easy is not his style. He remains an active chief executive under the new owner, CUC International.
19638 SMALL BUSINESS Monitoring Firm Offers Rx for Collateral Jitters
Dallas-based Diversicorp acts as a go-between for lenders and borrowers by monitoring inventory and accounts receivable for lines of credit. Through its expertise in this area, the company helped the Small Business Administration develop the GreenLine revolving line of credit program.
Mellon Bank Corp. believes it has found a better way to service businesses that need less than $100,000 of seasonal and revolving credit. Its Business Builder program lets companies pledge both business and personal assets to secure a credit line that can be accessed by telephone.
19578 COMPLIANCE A Model for the Modern Compliance Officer
Catherine Bessant, NationsBank's community reinvestment officer, combines a keen sense of competition with highly polished speaking skills. She just might be the prototype of compliance officers to come.
By yearend, a better-trained exam force will result in tougher compliance exams and more enforcement actions from the Federal Deposit Insurance Corp. Barbara Monheit, deputy general counsel at the FDIC's New York office, said the agency's reviews will become more sophisticated by December, when training of its new compliance examiners will be completed.
The Federal Deposit Insurance Corp. on Tuesday said state-chartered banks that are not members of the Federal Reserve no longer will have to disclose how much they are paid by the third-party firms handling securities transactions.
18702 CREDIT UNIONS Regulator Pulls the Plug On a Shaky Corporate
The National Credit Union Administration seized a large, specialty credit union that ran into a liquidity crunch after losing millions in mortgage derivatives. Capital Corporate Federal Credit Union provided credit and investment services to 483 member credit unions in the Washington metropolitan area.
Polish and Slavic Federal Credit Union in Brooklyn, N.Y., has built a thriving business by catering to the special needs of Eastern European immigrants.
Efforts to save tiny Nationwide Tenants Federal Credit Union from from liquidation have gone from difficult to almost hopeless.
19355 CREDIT/DEBIT/ATMs Mellon Ditches Plan To Buy Into MAC
Mellon Bank Corp. has backed out of an agreement to become a co-owner of Electronic Payment Services Inc., operator of one of the MAC system, one of the country's most prominent automated teller machine networks. The development is seen as a tough blow for EPS at a time when it is also concerned about federal antitrust scrutiny.
Paul F. Walsh, who formerly headed investment products businesses at Banc One Corp., has been named president and chief executive of Wright Express Corp. in South Portland, Maine. Wright Express, a specialist in fleet credit cards and related information services, was acquired last year by SafeCard Services Inc., the rapidly diversifying credit card registration and loss-prevention company.
The increasingly crowded field of secured credit cards is gaining another major player: Wachovia Corp.
First Bank System Inc. has introduced a purchasing card for companies with fleet operations. The Minneapolis-based banking company, which specializes in corporate credit card programs, is jointly offering the Visa fleet product with International Automated Energy Systems Inc.
A credit card program begun last year by the town of Orange, N.J., has generated a lot of interest from other cash-strapped municipalities, including New York.
19649 MORTGAGES Barclays Selling Servicing Business to Norwest
Norwest Corp. said it would acquire a $15 billion servicing portfolio and operations center from London's Barclays Bank PLC. No price was given, but a source close to the deal said it was about $210 million. Barclays said it would make a profit of about $50 million on the sale.
A glitch in Fleet Financial's offer to buy back shares of its mortgage company dramatizes the problem of valuing mortgage assets in a volatile market. Fleet is offering investors $20 a share, but two independent directors say that on the basis of report they commissioned from Morgan Stanley & Co., the price should be closer to $26.
NationsBanc Mortgage Corp. is steering a middle course in building a national mortgage franchise. Its president, Andrew D. Woodward, is splitting his time between evaluating takeover candidates and working on paring down his organization.
Fannie Mae announced a $100 million pilot program last week to buy government-insured home rehabilitation loans. The Title I loans, which are insured by the Department of Housing and Urban Development, have mostly been used by homeowners in older urban neighborhoods to make small improvements.
19346 TECHNOLOGY Bank of Boston Buying PC-Based IBM System
Bank of Boston Corp. has inked a multimillion-dollar contract to install a PC-based branch automation system from International Business Machines Corp.
In the wake of Checkfree's recent patent infringement suit against a home-banking competitor, experts are bemoaning the scope of some recent patents and questioning the rules for granting them.
CoreStates Financial Corp. has announced an effort to streamline the payor-payee relationship of two of its largest corporate clients with a financial electronic data interchange service. The pilot test of the new service exemplifies how banks hope to win the loyalty of corporate customers by offering EDI.
Cadix International Inc., an Atlanta software company, has developed an on-line signature verification system that it says will detect nearly 100% of unauthorized signatures.
19570 FINANCE Prime Loses No Time In Following Fed Hike
Banks raised their prime rate to 9% from 8.5% after the Federal Reserve raised short-term interest rates in a continuing effort to slow inflation.
New York Bancorp agreed to sweeten its bid for Hamilton Bancorp by about $5 million.
Merrill Lynch has merged its thrift and bank groups as part of a companywide downsizing. At least four executives in the financial institutions practice were laid off.
J.P. Morgan and Citicorp are among the nine banks lending $1.43 billion apiece to support Glaxo Holding's bid for Wellcome PLC.
Shawmut National Corp.'s shares jumped on takeover speculation. However, many market observers discounted acquisition rumors, saying that the New England regional is not of a mind to sell, and that potential acquirers are handicapped by low trading multiples.