Category Archives: Banking

Coffee, anyone? Local credit unions ‘make difference’ by paying for customers’ purchases Tuesday

Representatives of three Wichita credit unions were at a downtown coffee house Tuesday morning picking up customers’ tabs.

That’s according to the Kansas Credit Union Association, which said the effort is part of its “Make A Difference” campaign to raise awareness about credit unions in the state and to promote community giving.

The KCUA said in a news release Tuesday that 11 credit unions are participating in the campaign in Emporia, Kansas City, Ness City, Norton, Topeka and Wichita.

Officials from Equishare Credit Union, Mid American Credit Union and Wichita Federal Credit Union were on hand at 9:30 a.m. at Mead’s Corner, 430 E. Douglas, to pay for customers’ purchases.

KCUA said at each location Tuesday credit unions were expected to give away up to $1,000 in cash or gift cards.

This is the second “Make A Difference” giveaway organized by the KCUA. Last October credit unions were at gas stations across the state paying for customers’ gas purchases.

Bank regulator to close last of temporary offices opened at height of financial crisis

The Federal Deposit Insurance Corp. said this week it is making plans to close the last of its three temporary satellite offices opened after the 2008 financial crisis.

The last office to close is its East Coast Temporary Satellite Office, though that office’s closure is slated for the second quarter of 2014.

The East Coast office, based in Jacksonville, Fla., has a temporary staff of 420 employees and it is managing 138 failed bank receiverships for institutions located in the Southeast.

“Based on a review of ongoing workload and in recognition of the signs of the improving health of the banking industry, the FDIC has determined that its Dallas Regional Office will be able to absorb the remaining work of the ECTSO by the second quarter of 2014,” the FDIC said in a news release.

The FDIC said its temporary workers in Jacksonville will receive outplacement support because of the closing. It said most of the workers there were hired on a non-permanent basis.

The FDIC has already closed satellite offices in Irvine, Calif., and Schaumburg, Ill.

Kasasa account program at Emprise rewards customers with iTunes downloads, other perks

Emprise Bank is the second Kansas bank to offer a new checking and savings account program whose rewards include iTunes downloads.

Emprise joins ESB Financial in Emporia as the newest bank in the state to participate in the Kasasa program, whose rewards also include cash back credits and Amazon.com downloads.

Tom Page, Emprise CEO, said low interest rates are making it tough on bank earnings and the Kasasa program encourages things like debit card use and electronic statements, which ultimately help his bank’s bottom line.

“Significant transaction volume through debit card use and the electronic delivery of services … those are things that generate much more money for the bank than we will make by investing money,” Page said.

Page acknowledged that Kasasa is “different for us,” but a persistently low interest rate environment is prompting the industry to look at unconventional products and services.

FDIC says progress made on insurance fund, but higher assessments will remain

The Federal Deposit Insurance Corp. is making good progress restoring its Deposit Insurance Fund after several years of bank failures, but bankers shouldn’t expect the regulator to pull back anytime soon on the higher assessments it’s charging banks.

That’s what the FDIC’s board of directors heard Monday at its meeting at the FDIC’s headquarters in Washington, D.C.

According to a staff presentation and report to directors, the fund’s balance has increased for eight consecutive quarters and was at $11.8 billion at the end of 2011. But that represents a reserve ratio of 0.17 percent. The FDIC has a congressional mandate, via the Dodd-Frank Wall Street Reform and Consumer Protection Act, to reach a reserve ratio of 1.35 percent by Sept. 30, 2020.

FDIC staff told directors that their best estimate is that the plan to restore the fund in time to meet the Dodd-Frank requirements. But it may be the second half of 2018 before any easing of higher assessments on some banks occur.

Following the release of the update on the fund, the American Bankers Association issued a statement in which it said “the FDIC has been overly conservative in setting aside reserves for possible failures that did not occur.”

Report says mortgage activity is on the rise

Mortgage applications were up in the first quarter of 2012, and so was the average credit score of applicants, according to a report from MortgageMarvel.com.

The report says mortgage applications nearly doubled compared to the same period a year ago, and the average credit score rose to 733 from 716, “indicating that personal finances may be improving as well,” the report says.

Bank of America can’t catch a break

Bank of America, the embattled banking giant that’s wrestled with all sorts of negative publicity for the last three years, finds itself in the spotlight, again.

This time, Occupy Wall Street is calling for a sort of Bank Transfer Day against Bank of America on Friday. The group is calling the effort, “Move Your Money Relay.”

Occupy activists plan on providing “escorts” at Bank of America locations who will assist willing BofA customers in moving their accounts over to community banks and credit unions.

Pace of bank failures continues to slow

The nation made it through the weekend without a bank failure. Of course, the Easter weekend may have had something to do with that, given financial markets were closed for Good Friday.

But it wasn’t the first weekend in 2012 where the Federal Deposit Insurance Corp. had to take a bank into receivership or complete the sale of a failed bank’s assets to another institution, either.

An examination of the FDIC’s Failed Bank List might explain why. According to that list, there have been 16 bank failures through April 8 this year. In that same period in 2011, bank failures totaled 28. And in 2010 it was 42.

While there’s still a lot of year left, the pace suggests that the trend of rising bank failures that began nearly four years ago may just be coming to an end.

Will branch banking die? No quick or easy answer

Since Internet banking took hold the idea of the branch bank going the way of the paper ledger has been a topic of much discourse in the industry.

The discourse continues now that mobile banking — banking by smartphone and tablet — is all the rage and continues to grow as more banks take advantage of the technology.

As this Northwestern Financial Review post points out, the industry has added 20,000 more branches in the past decade.

Then again, all you have to do is take a look at the biggest consumer bank in the country and wonder aloud if branch banking is on its last leg. Just about every week for the past year or more, Bank of America has been shedding multiple branches across the country as it looks to become more efficient and shrink its branch network by 10 percent. The Charlotte, N.C.-based bank, by the way, has typically been the first to adapt to new means of delivering banking services, including mobile banking.

And as the population of bank customers who prefer online banking grows and matures, you can’t help but think there is a tipping point at which the branch office will be considered an outdated concept. Maintaining branch buildings and employing people to staff them is much more expensive compared with maintaining computer networks and technology that isn’t as staff intensive.

Big banks target retirement plans for new income

The Financial Times reported that three of the country’s biggest banks — Bank of America, JPMorgan Chase and Wells Fargo — are pursuing the administration of corporate 401(k) plans for new income.

The Times report says while it may not represent lots of new income, it does represent a steady source of it.

These banks, some of which are often referred to as “money center banks” or “too-big-to-fail” banks, have been looking for ways to recapture fee income they lost as the result of new regulations from the Federal Reserve and the Dodd-Frank Wall Street Reform and Consumer Protection Act.

Kansas connection still remains at FDIC

Sheila Bair’s departure last year as head of the Federal Deposit Insurance Corp. does not mean all of Kansas’ connection to the headquarters of the powerful bank regulator are completely severed.

On Thursday the Senate approved the nomination of Thomas Hoenig to the FDIC’s board of directors. Hoenig also awaits Senate confirmation as vice chairman of the regulator that administers the deposit insurance fund.

Hoenig was president of the Federal Reserve Bank of Kansas City for 20 years and retired last October. The Iowa-born economist was a frequent visitor to Wichita during his tenure.

Bair, who was raised in Independence and attended the University of Kansas, was chairman of the FDIC during one of the industry’s most turbulent periods, the 2008 financial crisis.

Household interest payments are lowest in 34 years

Low interest rates mean smaller interest payments for American households, according to a USA Today analysis.

The report says the average household is saving $3,100 a year because of lower interest rates.

Such payments haven’t been that low in 34 years, the report says.

Microsoft gains ground disrupting online banking hackers

Computer software giant Microsoft, with the help of the Feds and the RICO Act, or Racketeer Influenced and Corrupt Organizations, was successful late last week in thwarting part of a network of cyber criminals using botnets to steal from online banking networks.

A USA Today report said Microsoft was aided in its efforts by U.S. Marshals and two financial services industry trade groups.