American Banker articles from February 2005

American Banker archives from February 2005

Putnam CEO Discusses Plans for Turnaround.
February 1, 2005... When Putnam Investments named Ed Haldeman president and chief executive officer in November 2003, he says, he knew he needed to restore investor confidence one customer at a time. "At 2 p.m. the day I was hired I was sitting in the office...

Failure Lingers In FDIC& Debate Over Sweeps.(Federal Deposit Insurance Corp. )
February 1, 2005... Though Connecticut Bank of Commerce failed three years ago, it lives on in a policy dispute involving deposit insurance for sweep accounts. The reason the $384 million-asset bank has not become an afterthought is that it was involved in a...

Citi Under Prince: Lots Of Capital to 'Redeploy'.
February 1, 2005... For more than a year Charles O. Prince has been tearing through Citigroup Inc.'s global operations and lopping off units deemed inessential, low-growth, or both. Life insurance underwriting is the latest to fall out. The $11.5 billion sale...

What Color Is Your Carpeting?(Brief Article)
February 1, 2005... Community bankers used to mock "merchandising"; what sells is service, they insisted. But now a growing number are toying with color schemes, nudging display racks into better position, hiring merchandising consultants. Also inside: Why...

Closer to Closure.(Brief Article)
February 1, 2005... Marsh & McLennan, Putnam's parent, announced an $850 million settlement with New York's Spitzer but must still deal with a multimillion-dollar class action. Story on page 10 Copyright 2005 Thomson Media Inc. All Rights Reserved....

In Brief: Spitzer on Social Security Privatization.
February 1, 2005... New York Attorney General Eliot Spitzer stepped into the debate over Social Security reform and sounded other consumer protection themes in a speech Monday. Mr. Spitzer, who announced in early December that he would run for governor of New...

In Brief: Lower Dividend at Seattle Home Loan Bank.(Brief Article)
February 1, 2005... The Federal Home Loan Bank of Seattle said Monday that it will pay first-quarter dividends at an annual rate of 1.63%. The dividend is much lower than in the first and second quarter of 2004, when the annual rate was 4%. In the third...

In Brief: More Top Execs Gone from Fannie Mae.(Brief Article)
February 1, 2005... Two more top executives at Fannie Mae are leaving in the wake of the mortgage giant's accounting problems. The company announced Monday the retirements of Louis V. Hoyes, an executive vice president for the single-family mortgage business,...

Stranded School Band Gets a Lift.
February 1, 2005... It had been a tense few weeks for a California high school band since two local travel agents to whom members had paid $100,000 for a trip to China were arrested and charged with stealing from customers. But just as it seemed that the March...

In Brief: Earnings Dip 59% At Cardinal.(Brief Article)
February 1, 2005... Cardinal Financial Corp. of Tysons Corner, Va., said Monday that its fourth-quarter earnings fell 59% from a year earlier, to $1.7 million. The $1.2 billion-asset company said results were affected by a $3.5 million nonrecurring tax credit...

In Brief: Klamath Helps Sterling of Wash.(Brief Article)
February 1, 2005... Sterling Financial Corp. of Spokane said Monday that fourth-quarter earnings jumped 72% from a year earlier, to $15.5 million. Earnings for all of 2004 rose 60%, to $56 million. Much of the growth stemmed from its January purchase of the...

DM2 Using Loyalty Software.(software produced by Schimatic Cash Transactions Network.com Inc.)(Brief Article)
February 1, 2005... The Montreal point of sale equipment vendor DM2 Technology has licensed loyalty, stored-value, and gift-card management software from Schimatic Cash Transactions Network.com Inc. to use in a loyalty program it is testing. DM2, a unit of...

Discover Sounding More Optimistic on Growth.
February 1, 2005... Morgan Stanley's chief executive expects its Discover Financial Services Inc.'s deal with Wal-Mart Stores Inc. to boost the unit's profile and lead to new business that will expand the loan book and raise profits within two to three years....

SBA Loan Leaders Ranked by Number of 7(a) Loans: Approved in the 12 months through September 2004. Dollars in thousands.
February 1, 2005... (part 1 of 2) 1 Bank of America Corp. Charlotte 2 Citizens Financial Group Inc. Providence, R.I. 3 Capital One Financial Corp. McLean, Va. 4 Innovative Bank Oakland, Calif. 5 Wells Fargo San...

SBA Loan Leaders Ranked by Value of 7(a) Loans: Approved in the 12 months through September 2004. Dollars in thousands.
February 1, 2005... (part 1 of 2) 1 CIT Small Business Lending Corp. Livingston, N.J. 2 Wells Fargo San Francisco 3 Bank of America Corp. Charlotte 4 U.S. Bancorp Minneapolis 5 Money Store Inc.* Union, N.J. 6 ...

E-Loan Exec Chides Lenders.
February 1, 2005... Lenders are "finally starting to get" the importance of mortgage technology but have yet to develop end-to-end systems that reduce costs, according to the president and chief operating officer of E-Loan Inc. Mortgage executives have been...

Buyout of a Lender to Auto Dealers.(Brief Article)
February 1, 2005... iStar Financial Inc., a real estate investment trust that provides commercial real estate financing, has begun buying shares of another REIT, Falcon Financial Investment Trust, for $7.50 each under a previously announced tender offer. On...

Marsh Settles with Spitzer, Still Faces Suit.
February 1, 2005... Insurance broker Marsh & McLennan Cos. Inc. announced Monday that it will pay $850 million to settle allegations that it worked with insurers to rig bids, but it still faces private litigation. New York Attorney General Eliot Spitzer...

In Brief: Survey: Few ARC Complaints to Banks.(accounts receivable conversion)(Brief Article)
February 1, 2005... Few consumers are complaining to banks about the accounts receivable conversion process that turns their paper checks into automated clearing house payments, a survey found. According to a survey released Monday by Nacha, the electronic...

In Brief: Sterling of Wash. Using Treev System.(Brief Article)
February 1, 2005... Sterling Savings Bank of Spokane is installing a document-management system that stores electronic records and digital images of paper files. Cindy Parker, the senior vice president of information technology at the primary unit of Sterling...

In Brief: VectorSGI, Lockbox Firm in Software Pact.
February 1, 2005... VectorSGI, a Addison, Tex., unit of the Milwaukee banking company Marshall & Ilsley Corp., has signed a contract to deliver check-image software to a large Canadian outsourcer of lockbox services. VectorSGI would not identify the customer....

Emigrant Emphasizing Rates With New Web-Only Offering.
February 1, 2005... By introducing a high-yield savings account available only through its new EmigrantDirect.com Web site, Emigrant Bancorp is attempting to compete with the more established Internet-only banks on interest rates. But the New York company must...

Correction.(Correction Notice)
February 1, 2005... In Wednesday's paper, the page 10 chart on big banks' investment and insurance menus should have shown SunTrust offering proprietary and nonproprietary mutual funds. Copyright 2005 Thomson Media Inc. All Rights Reserved....

In Brief: Chemical of Mich. Has 5.9% 4Q Gain.(Brief Article)
February 1, 2005... Chemical Financial Corp. of Midland, Mich., announced Monday that its fourth-quarter earnings rose 5.9%, to $14.4 million. Diluted earnings per share were 54 cents, 5.6% more than a year earlier. For the year the $3.8 billion-asset company...

In Brief: Oakland Predator Law Struck Down.(Brief Article)
February 1, 2005... The California Supreme Court has struck down Oakland's anti-predatory-lending measure. Overruling an appellate court decision, the court said in a ruling issued Monday that the city had no right to enact its own ordinance, because a state...

In Brief: Zions Ups Quarterly Dividend to 36 Cents.(Brief Article)
February 1, 2005... Zions Bancorp.'s board raised the quarterly dividend to 36 cents per share and announced a new stock buyback plan. The 12.5% dividend increase and the $60 million stock repurchase authorization, both announced Friday, did not surprise Wall...

More Speculate that Mellon Will Exit HR.
February 1, 2005... A consensus is growing among the analysts who cover Mellon Financial Corp. that it will sell some or all of its human resources and investors services unit this year. In recent months, and again last week, executives of the Pittsburgh...

Editor's Note.(Brief Article)
February 1, 2005... The difference between advertising and merchandising is that advertising is meant to woo customers and merchandising is more about keeping them and encouraging them to spend more. It's a concept that retailers embraced long ago witness the...

Credit Unions' 2% Idea Is 100% Wrong.
February 1, 2005... One thing the savings-and-loan debacle of the 1980s taught us is the importance of a financial institution's capital in limiting risk exposure for the federal deposit insurance funds and for taxpayers. As former regulators, we have seen...

New Banks Getting Sold on New Technology.
February 1, 2005... It's easy to see why longtime Georgia banker Jim Powell decided to open Highland Commercial Bank in the bustling Atlanta suburb of Marietta. The area has "experienced a lot of development in the last five or six years," said Mr. Powell,...

Fee-Based Model Replacing Up-Front Commissions.
February 1, 2005... Investors who pay a traditional up-front sales commission are becoming downright rare at Liberty Bank in Middletown, Conn. Only 20% of its retail investors still fork over commissions, of 3% to 5% per transaction; the rest have opted to pay...

Prepaid Cards' Main Appeal Is Customer Retention.
February 1, 2005... Alpine Banks of Colorado in Glenwood tapped Metavante Corp. to roll out a Visa gift card late last year, just in time for the holiday rush. The $1.3 billion-asset banking company is aiming not so much to make money on the cards but to...

On Merchandising, Some Gung-Ho, Others Still Ho-Hum.
February 1, 2005... Like most retailers, community banks devote a fair amount of time and energy to external marketing, and often hire communications firms to design logos, slogans, or advertising campaigns. When BankNewport in Rhode Island wanted to overhaul...

How Fee Drop Would Alter Servicing.
February 2, 2005... In the past few months Fannie Mae and Freddie Mac have been exploring the idea of letting servicers retain less than 25 basis points a year of a loan's balance -- a minimum that the GSEs set in the mid-1980s. Such a reduction could...

Consensus -- for a Change: Basel II retail proposal draws few complaints.
February 2, 2005... Considering the friction Basel II has generated and a recent technical glitch, bank and thrift regulators needed a moral victory. They got it last week. Their proposal to help banks and thrifts measure capital levels for everything...

New Amex, New Mantra: 'Spend-Centricity'.
February 2, 2005... Within hours of American Express Co.'s announcement that it would spin off its financial advisory unit, the industry's version of the exit poll -- Amex's stock price -- revealed the decision to be a winner on Wall Street, where focus has lately...

Greater Bay Sees Promise, Wall Street Sees Problems.
February 2, 2005... Greater Bay Bancorp is the latest banking company to say it saw signs of life in California's commercial credit market in the fourth quarter. But analysts remain concerned about weakness in it broader loan portfolio and the accounting and...

Cost-Cutting Efforts Win B of A, Wachovia Upgrades.
February 2, 2005... Bank of America Corp. and Wachovia Corp. have received upgrades from analysts who said the Charlotte companies are undervalued and have gained momentum from acquisitions and cost-savings programs. Andy Collins at Piper Jaffray & Co. raised...

Executive Changes.
February 2, 2005... J.P. Morgan Chase & Co. has promoted James R. Popp to president of its Bank One operations in Wisconsin and made him the head of Bank One commercial banking there and in Minnesota. He succeeded Paul Greig, who left to become the head of...

Revenue-Raising Ideas Could Hit Financial Services.(Brief Article)
February 2, 2005... Among the taxation ideas circulating on Capitol Hill are a handful that could directly affect banks. On the table are eliminating deduction of interest on home equity loans and requiring that users of a tax shelter prove that it has...

Atlanta FHLB Gets a New CFO.(Federal Home Loan Bank of Atlanta)(Brief Article)
February 2, 2005... The Federal Home Loan Bank of Atlanta has hired a new chief financial officer, Ernest "Lee" Puschaver. Mr. Puschaver, whose hiring was announced Tuesday, was the director of finance and the chief accounting officer for FleetBoston Financial...

Broker in a Rival's Branch? Your Bank Can Do It Too.
February 2, 2005... Community bankers worry that big banks will use complex services to woo away their customers. A visit I made to a Bank of America branch in Summit, N.J., my hometown, may cast some light on such fears. I wanted to learn whether small banks...

Renewed Effort For Reintroduced Rural Credit Bill.
February 2, 2005... Largely because of cost concerns, a bill introduced by Nebraska Congressman Tom Osborne last year to give banks and thrifts tax breaks for lending in rural areas did not even receive a hearing. But the Republican reintroduced the Rural...

In Brief: Cardtronics, PNC in ATM Branding Deal.(Brief Article)
February 2, 2005... PNC Financial Services Group, Inc. has signed a deal to brand more than 150 automated teller machines deployed by Cardtronics Inc., the nation's largest merchant ATM owner and operator, in Walgreen Co. stores. The multiyear deal, announced...

In Brief: eFunds Buys ClearCommerce for $19.4M.(Brief Article)
February 2, 2005... eFunds Corp. has acquired ClearCommerce Corp., an Austin provider of fraud prevention and payment processing software for card-not-present transactions, including online, mail order, and telephone order sales. The $19.4 million cash deal,...

Metavante Details Plans for NYCE Integration.
February 2, 2005... Since buying NYCE Corp. six months ago, Metavante Corp. has been working to do something NYCE's former majority owner, First Data Corp., never managed to do -- integrate some operations. Executives from NYCE and Metavante, the technology...

Marquette Unit To Test Wealth Market in Minn.
February 2, 2005... Marquette Financial Cos. has entered the crowded wealth management marketplace with the launching Tuesday of its subsidiary, Marquette Asset Management Inc. in Minneapolis. John Pohlad, the chief executive officer and a managing director of...

In Brief: Hartford to Enter U.K. Retirement Market.
February 2, 2005... The Hartford Financial Services Group Inc., the No. 1 seller of variable annuities in both the United States and Japan, announced its plan Tuesday to market individual investment and retirement savings products this year in the United Kingdom....

In Brief: A.M. Best to Review Amex Insurer Ratings.(Brief Article)
February 2, 2005... A.M. Best Co. in Oldwick, N.J., said Tuesday that it has placed under review the A-plus financial strength rating of IDS Life Insurance Co. in Minneapolis and its subsidiaries. It took the action with negative implications, the rating...

In Brief: Citi's Private Bank Finds Regional Likes.
February 2, 2005... The appearance of distinct geographic preferences in behavior of the wealthy worldwide and investing preferences among them are two of the findings of a survey released Tuesday by Citigroup Inc.'s private bank. The survey also found global...

In Brief: Cendant Spinoff Names Mortgage Chief.(PHH Corp)(Brief Article)
February 2, 2005... PHH Corp., a mortgage and fleet company spun off this week from Cendant Corp., has promoted Joe Suter to president and chief executive officer of mortgage operations. Mr. Suter's promotion was announced Tuesday, a day after the spinoff of...

Jack Henry Raises Dividend.(Brief Article)
February 2, 2005... Jack Henry & Associates Inc. has increased the dividend on its common stock by 13%, to 4.5 cents a share. The higher dividend will be payable to shareholders of record as of March 1, Jack Henry said Monday. The most recent divided of 4...

Will Presentment Growth Enliven Online Bill Pay?
February 2, 2005... Bankers are divided over whether electronic bill presentment can provide new spark to online bill payment. Some say mainstream billers are realizing the value of online bill payment, whose growth has slowed, and are growing more willing to...

Correction.(Correction Notice)
February 2, 2005... In Tuesday's paper, a page 20 story confused the 2004 fee revenue and total revenue of Mellon's human resources and investor services unit. It was fee revenue that declined nearly 3% -- and to $918 million, not $914 million. Copyright 2005...

In Brief: Seattle FHLB Chief Stepping Down.(Brief Article)
February 2, 2005... The Federal Home Loan Bank of Seattle said Norman B. Rice will step down as president and chief executive on March 15 and be replaced on an interim basis by David Bley, the director of products and services. Mike Daly, the vice chairman of...

In Brief: Synovus Investment Head Resigns.(Brief Article)
February 2, 2005... Synovus Financial Corp. said Walter M. "Sonny" Deriso Jr. has resigned as a vice chairman and the head of its financial management services group. The Columbus, Ga., company announced the resignation Tuesday and said it has begun its...

In Brief: Mellon, Citi Mum on Possible Sale.(Brief Article)
February 2, 2005... Mellon Financial Corp. and Citigroup Inc. would not discuss a news report Tuesday that said Mellon has retained Citi's investment banking services to sell its human resources and investor services unit. The New York Post reported that the...

Mich. Bank Finally Gets Ga. Toehold.
February 3, 2005... If Peoples State Bank in Jeffersonville, Ga., was in any other state, Capitol Bancorp Ltd. would not have had much interest in buying it. Peoples has just $21 million of assets, it has lost close to $2 million over the last three years,...

Mellon Unit Still in Mood To Acquire.
February 3, 2005... Mellon Financial Corp.'s private wealth management group plans to expand aggressively this year and is looking to make acquisitions in several high- growth states, its chief says. David F. Lamere, a Mellon vice chairman and the private...

OCC's New Predator Rule: Are violations a safety-and-soundness issue?(Office of the Comptroller of the Currency)
February 3, 2005... The Office of the Comptroller of the Currency says it has added teeth to its efforts to curtail predatory lending, but a top Democrat said the move only underscored that wider reforms are necessary. The OCC identified objectionable or...

Hedging, Home Equity Hurt Countrywide Profits.
February 3, 2005... Among the many factors that depressed Countrywide Financial Corp.'s fourth-quarter earnings, the biggest surprise was that hedge losses were not offset by gains in what was being hedged. The company recovered some impairment on servicing...

Northern Trust Close To an Outsourcing Foothold in Britain.
February 3, 2005... Northern Trust Corp. is negotiating its first U.K. outsourcing deal. On Wednesday, Northern Trust said it will provide back- and middle-office services, including record keeping and trade matching, confirmation, and settlement, to Insight...

PNC Seen Offering Less for Riggs.
February 3, 2005... With a self-imposed deadline for an announcement drawing near, investors and analysts are acting convinced that PNC Financial Services Group Inc. will negotiate a lower price for Riggs National Corp. The embattled Washington company, which...

Reg Complexity Fuels Demand For ABA Institute.(American Bankers Association)
February 3, 2005... The Institute of Certified Bankers does not have a football team or even classes, but its degrees are in hot demand among financial services employees who want to get ahead. Founded in 1990, the Washington-based institute is a...

Rabobank Putting Its Name on Bank, Arena in California.
February 3, 2005... About two years after buying its first and only U.S. bank, the Dutch giant Rabobank is raising its profile here. The state-chartered $2.5 billion-asset Valley Independent Bank of El Centro, Calif., will be renamed Rabobank -- and the...

Executive Changes.
February 3, 2005... MIDWEST UMB Financial Corp., a multibank holding company in Kansas City, Mo., with $6.8 billion of assets, has hired Bradley J. Smith as its executive vice president of consumer services. He will oversee retail product development and...

In Brief: BB&T to Use First Data Check Service.(Brief Article)
February 3, 2005... BB&T Corp. has agreed to use First Data Corp.'s Star Chek Direct check debit and verification service. The service, introduced last year, is designed to reduce check fraud losses and processing costs, streamline the administration of check...

In Brief: CompuCredit Exec On Nonprofit's Board.(Richard W. Gilbert named a director of the Consumer Credit Counseling Service of Greater Atlanta)(Brief Article)
February 3, 2005... Richard W. Gilbert, the vice chairman and chief operating officer of CompuCredit Corp., has been named a director of the Consumer Credit Counseling Service of Greater Atlanta. The nonprofit group provides free, confidential counseling, as...

In Brief: Washington Trust Signs R.I. ATM Deal.(the automatic teller machines can be placed in public buildings and schools in the state of Rhode Island)(Brief Article)
February 3, 2005... Washington Trust Co. has won the right to put automated teller machines in buildings owned by the state of Rhode Island, including the Division of Motor Vehicles and state colleges and universities. The three-year deal, announced Tuesday,...

In Brief: Pa. Bank Buys Retirement Plan Firm.(Rockford Pensions LLC is one of the two businesses bought by the bank)(Brief Article)
February 3, 2005... Susquehanna Bancshares Inc. in Lititz, Pa., said Wednesday that it had bought Brandywine Benefits Corp. and Rockford Pensions LLC, two business lines of a Wilmington, Del., financial planning, consulting, and administration entity collectively...

In Brief: First Albany Sells Asset Manager Unit.(FA Asset Management sold to Johnson Illington Advisors LLC, a registered investment adviser; Hugh Johnson is chairman of Johnson Illington and member of the board of Illington Fund Management)(Brief Article)
February 3, 2005... First Albany Cos. Inc. announced Wednesday that it had sold its asset management unit to a partnership of some of the unit's employees and a New York fund of funds company. FA Asset Management was sold to a newly formed investment...

In Brief: Pru Retirement Unit Unveils Product.(Brief Article)
February 3, 2005... Prudential Retirement, a business of Prudential Financial Inc., said Wednesday that it has introduced PruSolutions, a defined contribution product for qualified retirement plans with $1 million to $20 million of assets. It offers smaller...

In Brief: Vanguard Adopts MSCI as Benchmark.(Brief Article)
February 3, 2005... MSCI, a provider of U.S. equity, international equity, fixed-income, and hedge fund indexes, has announced Vanguard Group's adoption of its U.S. Broad Market Index as the target benchmark for index funds with assets totaling more than $60...

Harland's Deal a Leap in Core Processing.
February 3, 2005... By acquiring a Cincinnati outsourcer, Harland Financial Solutions Inc. would gain scale to help it compete in the consolidating market for core processing, where the four largest providers have been gobbling up rivals. Intrieve Corp. would...

In Brief: Wausau Sold, Names Delgadillo Its CEO.(Brief Article)
February 3, 2005... Joseph L. Delgadillo, a former chief executive of Metavante Corp., has reemerged on the banking technology scene as the president and CEO of Wausau Financial Systems Inc. Wausau, a transaction processor based in Mosinee, Wis., announced...

Pipeline.
February 3, 2005... All Aboard, Please If lenders want to develop a paperless mortgage, they all must adhere to common technology standards developed by the Mortgage Industry Standards Maintenance Organization, executives said this week at a Miami conference....

In Brief: Chilean Bank Gets U.S. Orders.
February 3, 2005... The Federal Reserve Board and the Office of the Comptroller of the Currency issued separate cease-and-desist orders Wednesday against Banco de Chile for violating the Bank Secrecy Act. The OCC order said that officials at the bank's New...

In Brief: Citi Sorry for Eurobond Trade.(Brief Article)
February 3, 2005... Citigroup Inc. said Wednesday that the size of its controversial Eurobond trade in August was "unintentional." The $15.6 billion trade flooded an electronic exchange with sell orders. Minutes later Citi bought some of the bonds back at a...

Publix Alliances Upend Payment-Fee Models.
February 4, 2005... Publix Super Markets Inc., the southeastern grocery chain, has hit upon an innovative way of managing its payment expenses through financial institutions. According to executives at institutions that have taken advantage of the new...

For Biggest, No Brakes On This Trend.
February 4, 2005... SunTrust Banks Inc. has not built a lot of branches in recent years -- except for last year, when it added 54 in a reinvigorated retail banking strategy. This year the $159 billion-asset Atlanta company plans to add 60 to 80, mainly in...

Simplify CRA? Not So Fast: Citi, GE say keep as is; JPM offers alternative.(Community Reinvestment Act)
February 4, 2005... WASHINGTON -- Small thrifts praised the Office of Thrift Supervision for letting dozens more of them qualify for streamlined community reinvestment exams, but its effort to simplify exams for bigger companies is falling flat among the...

People.
February 4, 2005... More to Sell? Citi may not be done with its makeover. "We continue to evaluate all our businesses," Chuck Prince, Citi's CEO, said during a conference call this week to discuss the sale of its Travelers Life and Annuity business to...

In Brief: Subcommittee Leaders Appointed.(House Financial Services Committee and Senate Banking Committee)(Brief Article)
February 4, 2005... The House Financial Services Committee and the Senate Banking Committee have named their subcommittee chairmen. The Republican House Financial Services lineup is the same as last year's, except Rep. Deborah Pryce of Ohio has been put in...

In Brief: GSE Hearings Set on Capitol Hill.(government-sponsored enterprise)
February 4, 2005... Two hearings on government-sponsored enterprise issues have been scheduled for next week. Senate Banking Committee plans a broad hearing Thursday about the role of GSEs in the mortgage market. The slated witnesses are John C. Weicher,...