PayThink

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.

When I started in this business, if the Lead Balloon Corp. had hung up the Going Out of Business sign and you needed comment on how its closure would affect its credit union, you called the Lead Balloon Employees Credit Union. An airline's employees on strike? Append the airline's name with "Employees Credit Union," and you knew who to call.

As I watched the recent British Open golf tournament my thoughts strayed to the predicament facing the financial services industry and how we're rising to the challenge.

A quick link of interest for BankThink readers: Simon Johnson pointed out on The Baseline Scenario yesterday just how tiny Citigroup Chairman Dick Parsons' financial interest is in the company he chairs.

The banking industry has voiced a range of objections to the proposed Consumer Financial Products Agency, the new consumer protection regulator the Obama administration wants to establish. Even regulators say putting consumer protection in a separate agency would be a step in the wrong direction. But an analysis of fair lending law enforcement among bank regulators by the General Accountability Office concludes the present system isn't working well at all. The GAO's criticism of the current regulatory structure is explicit, but it's worth pondering whether there's implicit support for something like the CFPA woven into the report as well.