US Banker articles from August 2008

US Banker archives from August 2008

This Month.
August 1, 2008... 26 Cover Story: Waiting for the Other Shoe to Drop The subprime mortgage meltdown has proved to be a massive strain on the industry; but the subprime crisis will be a kitten compared to the lions roar that would be created by a widespread...

America's Big Margin Call: Paying For Freddie, Fannie: How precisely the Federal Reserve and the Treasury Department-with the country in tow-come to find themselves in this position is a matter of fierce debate, but it is not one of ignorance or illusion. The mission creep of GSEs had but one motive: profit.(Federal Home Loan Mortgage Corp.)(Federal National Mortgage Association)
August 1, 2008... IndyMac Bancorp and Bear Stearns before it are just the tip of the iceberg. With Freddie Mac and Fannie Mae hanging in the balance, bolstered for now by a last-minute government-led rescue plan, American taxpayers are facing what could amount...

Green initiatives: TD Bank's ATM Network Reduces Carbon Footprint: Purchasing renewable energy to run ATMs.
August 1, 2008... When customers use one of Toronto Dominion Banks 2,600 ATMs across Canada, theyll also be making an investment of sorts in that countrys use of renewable energy. The bank has entered into a partnership with Bullfrog Power to purchase an...

Scene and Heard.(Quotation)
August 1, 2008... They recognize that its not tangential or ancillary to what theyre doing. Theyre not treating it as a stepchild. -Michael White, of the consulting firm bearing his name, on why some community banks are better than others at selling mutual...

Incentives: Serving Rewards: Tying customer service to bonuses gains fans.
August 1, 2008... Each month employees of Umpqua Bank wait with bated breath to hear the banks evp of retail banking, Ric Carey, announce the top branches based on performance and servicefrom No. 1 to No. 145. Hes got their attention because the results put...

Hits and Has-Beens.(briefs)(Brief article)
August 1, 2008... Wachovia, the fourth-largest U.S. bank, named Treasury Undersecretary Robert Steel chief executive. Steel has played a key role in helping Treasury Secretary Henry Paulson try to address the nations housing crisis, a big cause of Wachovias...

FreshInk.(briefs)(Brief article)
August 1, 2008... 1. Orangeburg, SC-based Community Bankshares, with $570 million of assets, is being acquired by Columbia, SC-based First Citizens Bancorporation for $96.1 million in cash. 2. Community Bank System, Inc., with $5 billion in assets, is...

Florida Bank Finds Itself the Proud Owner of Not-So-Fun Theme Park.(Florida Community Bank)
August 1, 2008... They probably never planned to run a kiddie theme park from the back offices of Florida Community Bank. But one of the by-products of a seriously stressed real estate market is that more banks are playing repo man. And so it turns outfor a...

Noted and Noteworthy.(Brief article)
August 1, 2008... Curtains rise on the party conventions soon, but the candidate that got a lot of financial industry execs dough early on is long gone: Senator Chris Dodd of Connecticuts supporters included Ellen Alemany, CEO of RBS America, Amy Woods Brinkley,...

Banking's Private Equity Conundrum: The banking industry needs private equity investors, and the Feds can encourage the investment without abdicating oversight. They just need to be clear on what the rules are.
August 1, 2008... As regulators meet with private equity managers and consider the rules that govern PE investment in banks, a principle they should keep firmly in mind is the benefit of clarity. Despite the gnashing of teeth among regulators that private equity...

Patents: Intellectual Property on Trial: Sick and tired of "patent troll" lawsuits against banks, the Financial Services Roundtable and institutional members including Bank of America are urging a federal court to overturn the patentability of certain business method processes. But not all FIs agree.
August 1, 2008... Chryslers Lets Refuel America sales incentive sounds like a gas giveaway that puts the car maker on the hook for skyrocketing gas pricesbut look again. Chrysler is betting that by guaranteeing gas for $2.99 a gallon, itll sell more...

Credit Decisioning: Top Tools For Tough Times: Today's risks prompt smaller banks to seek cutting-edge solutions.
August 1, 2008... At first glance, a $5.2 billion-asset bank in Montana wouldnt seem to have much in common with Charlotte, NC-based behemoth Wachovia. But when it comes to credit decisioning, First Interstate Bank is playing on the same field. First...

Risk Assessment: Call It a 'Green' FICO: Conducting an environmental risk assessment was mandatory even before "An Inconvenient Truth." Now a new automated scoring tool can simplify the task.(First Isabela Cooperative Bank)
August 1, 2008... The FICO score, and the predictive analytics behind it, revolutionized credit decisioning not long after it was unveiled by Fair Isaac in 1989. In the same vein, Diane Baum hopes that her automated environmental assessment, dubbed Enviroscore,...

Red Carpet Service for the Worried: In these turbulent economic times, Wells Fargo and Citizens Bank are beefing up their in-branch advice to expand relationships and soothe the fraying nerves of the mass affluent.
August 1, 2008... There are plenty of consumers nervous about their financial health these days, who seek a voice of calm and solid advice; banks such as Wells Fargo and Citizens Bank see this need as an opportunity to build long-term relationships that extend...

AD Beat: Cap One Pins Hope on NYC: Capital One's new ad campaign is everywhere, just like its ATMs and branches now that its North Fork acquisition is closed.(Automated teller machines)
August 1, 2008... There are some cardinal rules when using public transportation, and right at the top of that list is not making eye contact with another rider. Thats one reason public transportation is such a good place for an ad campaign. Those commuters eyes...

The Other Shoe...: If you thought the subprime mortgage crisis was something, you ain't seen nothing yet. Commercial real estate is showing signs of weakness, and the results promise to be much more painful for the industry-particularly community banks, which count CRE lending as a bread-and-butter business. With regulators cracking down, investors fleeing and capital showing signs of drying up, expect more bank failures.
August 1, 2008... When examiners from the OCC arrived in February to begin going over the books at the First National Bank of Artesia (NM), they bee-lined almost immediately for a portfolio of construction and development loansmany of them in the hot Las Cruces...

Despite Annuity Demand Banks Don't Respond: While annuity sales are up industry wide, 90 percent of community banks still aren't involved. The most common excuses are a lack of expertise and the fear of cannibalizing the deposit base.
August 1, 2008... With the mortgage and credit markets in shambles and banks reining in lending, any income is welcome income. So community bankers should take note that theyre trailing their bigger brethren when it comes to offering a product rich in fees that...

Web Auction Levels the Playing Field: A new auction site offers high interest rates for consumers across the U.S. and low costs for banks large and small. But the lack of personal service serves to remind customers that financial products are nothing but commodities.(MoneyAisle)
August 1, 2008... MoneyAisle is betting that todays consumers consider interest rates above almost all other factors when deciding where to park their money, including personal interaction. Launched about two months ago, the online service works by asking...

Visa's Online Community Taps Social Network: Visa is leveraging Facebook to create a community for small business owners. Analysts say the move is a harbinger of things to come as more businesses build online customer networks.
August 1, 2008... Being a small business owner can be a very lonely walk, says Visas head of small business marketing Alex Craddock. It was with that premise in mind that the San Francisco-based company wanted to create a community for its small business...

Check 21 Imaging Technology Branches Out to E-docs: Wachovia and Software Earnings teamed up to create OnTrac for Wachovia in the wake of Check 21, and are now pitching it to other banks as a way to track e-docs of all types.
August 1, 2008... The ability to convert paper checks to electronic images for processing, transmission and presentment since the Check 21 Act went into effect in 2004 has created opportunities and headaches for banks large and small. For big banks, with...

Getting Antsy. Advisors Cope With High-Strung Clients.: Too much time and investment information, often offered in an emotionally charged manner, combined with a deteriorating market, can create high-strung clients and overworked advisors.
August 1, 2008... Some investors get jittery even in the best of timesand these are not the best of times. The fluctuations in the stock market have created quite the headache for advisors, not to mention the surfeit of investment information via the Internet...

Real-Estate Trouble: It's Deja Vu.
August 1, 2008... It seems that periodically banks get clobbered by the real-estate market. If it isnt one thing, its another. Sometimes it is due to external forces beyond banks control. Back in the 1970s, banks real-estate-loan portfolios consisted of...

What Financial Services Can Learn From Lean.
August 1, 2008... Lean, the business philosophy that has driven Toyotas relentless rise to the top of the auto industry, is making significant inroads into banking and financial services. And the results are impressive. The gains through eliminating waste and...

The Strategic Case for Outsourcing Back-Office Chores.
August 1, 2008... The slow-to-change banking sector faces a disquieting economic environment punctuated by a credit squeeze, consolidation, regulation, aging bank systems, new technology and unrelenting competition from traditionaland nontraditionalrivals. ...

The Next Frontier: Rights Issues?: Capital raising is top of mind in many board rooms these days. One strategy, popular in Europe today but out of favor in the States for 40 years, may be worth another look.
August 1, 2008... At a time when banks across the U.S. are scrambling to repair balance sheets, and when traditional sources of funding are drying up, bankers may want to take a closer look at a capital raising technique thats popular in Europe but virtually...