Was Loan Bias Case A Beginning or an End?
Chevy Chase Federal's settlement of a fair-lending case remains controversial a year later. Some believe it foretold a wave of aggressive enforcement; to others it seems in retrospect to have been the high-water mark.
Eleven banks have asked the FDIC to change the way it measures thrift deposits - and thereby save banks about $165 million on payments toward rebuilding the ailing thrift fund. The banks argue that they should not be charged for thrift deposits that run off after they acquire them.
Hoping to resolve potential antitrust obstacles to their planned merger, Fleet Financial Group and Shawmut National said they would sell 64 branches with $3.2 billion of deposits.
Banks are using loan counseling to fight high loan default rates among trade school students. "We talk to a lot of students individually, and that seems to really help them understand their obligations," said Sandra Dawson, the student loan coordinator at Huntington Banks of Michigan.
Federal Home Loan Bank presidents took home $302,824 on average in salary and bonuses in 1994, according to figures released by the Federal Housing Finance Board.
NationsBank Wins $500M Military Deal
The Defense Department awarded NationsBank a five-year contract to provide banking services to U.S. military forces and civilian defense employees overseas. NationsBank, which had previously operated 17 branches at military sites in Japan and Okinawa, extends its coverage to 108 branches throughout Europe and Asia.
Taking a step toward interstate branching, BankAmerica announced plans to merge its Washington and Idaho bank units. The merger, which is expected to be completed by yearend, would give BankAmerica its first single bank unit operating branches in more than one state.
Saying it would further refine - not abandon - its branch banking system, PNC Bank Corp. has named Frederick J. Gronbacher executive vice president and manager of consumer banking.
The Compass Bancshares proxy battle ended months ago, but that hasn't stopped the principal antagonists from continuing to bash each other. "The election's over, but they don't want to leave it alone," complained the loser, former chairman Harry B. Brock Jr..
Hibernia will realign its banking regions now that a top executive has resigned to take a senior job with a leading subprime home equity lender.
Small Banks Hunting For Two-Scoop Deals
As the merger scene heats up, community bank directors and managers are on the lookout for such double-dips - deals with banks that eventually end up as takeover bait themselves. If shareholders of the original bank hold onto stock throughout the string of sales, they often reap far more than had they accepted cash at the first sale.
Farm suppliers have jumped into lending in a big way. "There are some areas where the community banks see us as a threat," says Mike O'Brien at the FS Credit unit of Growmark, a Midwest cooperative.
The 1,805 citizens of Latta, S.C., are about to get back their home town bank - though in a highly unorthodox way. Six years ago, SouthTrust of Birmingham, Ala., bought Latta Bank and Trust as a jumping off point into South Carolina. The management at the Latta bank - essentially the team that ran it before the sale is spearheading a local effort to buy it back.
David G. Massad, chairman of Commerce Bank and Trust, has acquired a 9.9% personal stake in a competitor bank that has resisted his proposal to merge.
A nonprofit group intends to feed the credit-starved inner-city neighborhoods of the District of Columbia by starting a community development bank. The group recently filed a charter application with federal regulators and hopes to open its doors by December with two locations, calling itself Community First Bank of D.C.
Banks Hit Voluntary Race, Sex Data Plan
Bankers overwhelmingly oppose a Fed proposal under which they could voluntarily collect data on the race and sex of small-business loan applicants. "Electing not to collect the information will alone be considered incriminating," wrote an American Bankers Association lawyer in one of 125 comment letters.
Software Helps Banks Steer Clear of Bad Guys
Banks of all sizes are turning to a set of software products designed to help them comply with regulations of the Treasury Department's Office of Foreign Asset Control.
Regulators from all the agencies will begin a crash course in the new Community Reinvestment Act exam procedures starting Sept. 18 in Dallas.
Bankers are of two minds when it comes to the Federal Reserve Board's proposed change to the credit advertising rules - they either love it or hate it. Supporters applauded the Fed for planning to give bankers more discretion in making rate disclosures. But opponents said any change is bound to increase the compliance burden on banks.
Rhode Island, New York Corporates May Merge
Faced with a shrinking client base, Rhode Island Corporate Federal Credit Union is weighing a merger with New York's Empire Corporate Federal Credit Union, industry sources said.
In the world of trade group politics, the National Association of State Credit Union Supervisors may have scored a coup in opposing legislation to strengthen the federal government's supervisory power over state institutions.
As military-based credit unions across the country consider their prospects in the wake of base closings, Andrews Federal Credit Union offers an example of how to find new markets to replace the ones that are disappearing.
Survey Finds a Hidden Passion for Smart Cards
Consumers are so interested in smart cards that they'd switch banks to get one, according to a MasterCard survey. Two thousand people were questioned in the United States and Australia.
Acknowledging that one of its major meetings has lost luster in recent years, the American Bankers Association is out to create a distinctly different impression at the 1995 National Bank Card Conference event, scheduled for Sept. 10-13 in New York.
First USA has recruited one of the credit card industry's star executives to be its chief financial officer. Jack M. Antonini, who guided USAA Federal Savings Bank to industry prominence, will become First USA's vice chairman for finance and planning.
Verifone, a company best known for creating a mass market in credit card authorization terminals, has put its imprimatur on the new technology by creating a high-visibility business unit under vice president Michael J. Shade.
Advanta has made two key appointments to bolster its nascent international business. The nation's 14th-largest credit card issuer named Jim Allhusen executive vice president last week. In June it named John F. Mullady general manager of RBS Advanta, its joint venture with Royal Bank of Scotland.
Fleet Putting Loads On Its Mutual Funds
Fleet Financial Group is scrapping its vaunted no-load mutual fund strategy. Starting Nov. 1, a 3.75% fee will be tacked on when most Galaxy funds are purchased. In return, Fleet will expand its investment counseling services to fund customers.
Invest Financial , already a leading provider of investment products through banks, is preparing to acquire two competitors in a bid to become the dominant player in its field.
Mutual fund executives say they support the SEC's efforts to simplify risk disclosure, but they warn of pitfalls in trying to make prospectuses both meaningful and easy to understand.
Quick & Reilly, one of the biggest names in discount brokerage, has struck a deal to market its wares through a tiny Florida bank. The arrangement with $40 million-asset Admiralty Bank marks the first time that the nation's third-largest brokerage firm has housed an office in a bank branch.
Credit Scoring Seen Key To Hacking Red Tape
For years, mortgage lenders have relied on skilled underwriters, complex rules, and fat folders of application documents to decide whether they would make a home loan. Now, a push to automate the credit decision is leading lenders to use a technique called credit scoring.
The biggest news in a busy 30 days on the mortgage M&A front has been an agreement by Mellon to buy Metmor Financial from Metropolitan Life for $165 million. And an even bigger deal by an insurance company is in the offing: the sale of Prudential's mortgage unit to either a single buyer or a group.
Banks leery of lending in Mexico may have hit upon a safer alternative - financing U.S. citizens' vacation homes there. Winning a favorable rating on the loans once they are securitized remains crucial, however.
Corestates Financial, eager to raise its profile as a mortgage lender, is expanding its corporate-affinity strategy to include home loans.
Checkfree Plans $110M Initial Public Offering
Checkfree, the Ohio-based payment services company, is planning an initial public offering that would raise about $110 million. The stock is expected to start trading on the Nasdaq market in early October.
Chemical Bank and First National Bank of Boston said that within two months they will demonstrate an "electronic check" that could become widely available for payments between computer users on the Internet.
Fiserv said it has reached an agreement to acquire the check processing business of Alltel Information Services, one of its top rivals in bank technology outsourcing.
The SEC is considering ways to keep a popular Internet data base of corporate filings from going off-line as a free service this fall.
Michelle Arden has been touring the data superhighway for years. Now she's steering Sun Microsystems' efforts to put financial transactions on- line - but selling the idea to banks is an uphill climb.
Short Sellers Zero In On Likely Acquirers
This summer's wave of bank mergers has drawn not only investors expecting stronger bank stock prices, but also those betting some banks' shares will weaken.
In another sign that commercial banks may have as much difficulty holding onto talent as investment banks, several key members have left PNC Bank Corp.'s corporate finance group to join Pittsburgh-based investment bank Parker/Hunter.
Sensing that Bankers Trust was changing for the worse back in 1989, Richard Tanenbaum left to develop option pricing software. His new product is designed to save users from the fate that befell BT customers such as Procter & Gamble.
Insiders, apparently anticipating a downturn in bank stocks, have been selling their companies' shares in high volumes.
Are the nation's consumers tapped out? Consumer credit has grown sharply over the past several years. Recently, however, delinquency rates have been edging up, and job growth has plummeted.