American Express became the latest financial institution to seek the comforts of being a bank; last week the Federal Reserve approved its application for a bank holding company license. “With Federal Reserve oversight we should gain greater access to the capital on offer under the current and any future government-sponsored programs,” according to Amex chairman and CEO Kenneth I. Chennault.
CIT has made a similar pitch to the Fed, and is also going for some of the money in the Treasury’s CPP. “Our commitment to the success and continued viability of middle market businesses has not wavered,” in the words of Jeffrey M. Peek, chairman and CEO of CIT. “As a bank holding company CIT would be well-positioned to ensure the continued flow of liquidity directly to main street businesses and entrepreneurs.”
Meanwhile, two insurers have agreed to purchase banks in the past few days. Genworth Financial reached an agreement in principal to purchase Maple Grove, MN-based InterBank, a savings and loan institution with about $1 billion in assets. Genworth is applying for S&L status and for some CPP funds. Hartford Financial Services Group agreed to buy Federal Trust Bank for $10 million, contingent on its acceptance as an S&L and Treasury’s approval of its CPP application.
