||Bank disclosure and the Euro Crisis - a message from John Taylor, NCRC Washington D.C.
The European Crisis on Greek government bonds has puzzled the big audiences especially in Northern Europe. Many citizens bombarded by irresponsible tabloids assumed that their governments have lent enormous amount of money to Greece which these people are not willing to repay because they are either too lazy or too corrupt or just showing a mentality of irresponsible... [more...]
||US housing crisis: Paper shows that poor people were not to blame for the housing crisis
Housing bubble and supply side factors are found to be the main reasons for the crisis. E.g. house price expectations led lenders and buyers to buy into an unfolding bubble based on inflated asset values. The paper finds that distribution of mortgage debt originated in 2002 and 2006 is concentrated in middle and high income borrowers, not the poor. Middle and high income... [more...]
||News from our partner NCRC about the War on Poverty in financial services in the USA
Our partner in the USA the National Community Reinvestment Coalition with whom we intentionally share the abbreviation CRC (Coalition for Responsible Credit) defends the rights of especially poor people in the USA to have fair, responsible and equal access to financial services. It was once born out of misuse banks provided when redlining whole areas of cities in which... [more...]
||FRANCE: Based on President Hollande’s pre-election response on fighting financial exclusion, the French authorities may take some measures for greater bank transparency and...
In France, coalition partners and others have been actively calling for bank greater transparency and the benefits of having a data collection infrastructure on the extent and nature of bank lending and presence in serving consumers and their communities. The best example available for such a possible system is still the US Community Reinvestment Act from 1977 and the... [more...]
||US - CRA to be discussed. Below some issues regulatory agencies will need to look at.
Passed in 1977, the Community Reinvestment Act was landmark legislation requiring financial institutions to serve the lending, investment and financial service needs of their communities. Despite the broad power given to the federal regulators to implement CRA regulations, it has increasingly failed to oversee financial institutions in a manner that would protect... [more...]
||USA - The new financial reform bill has been passed and made public (all 2,000 plus pages)
ECRC global partner NCRC has released its comments on the new Financial Regulatory Reform Bill which the Conference Committee has passed today. Below are the press releases. Financial Regulatory Reform Bill Passed by the Conference Committee Washington, DC- Early this morning, 28th June 2010, the Conference Committee passed the Financial Regulatory Reform Bill. John... [more...]
||As UK buys 50% of RBS, Who Might Buy Its US subsidiaries & with what bailout funds?
Below is an article analyzing the what-ifs of Royal Bank of Scotland's U.S. subsidiaries Charter One and Citizens Banks being sold off, now that the UK government owns more then half of RBS. While listing the big banks which probably won't make it bid, it hypes Capital One, Morgan Stanley, Suntrust and Regions, saying that the last two might use their US government TARP... [more...]
||HSBC and AIG grow in Latin America, credit reporting in Australia
Hi -- even during summer subprime melt-down here in the U.S., big subprimers HSBC (Household) and AIG continue to grow overseas. And in Australia, moves to make credit histories more detailed. One day, the U.S. merger market will revive... Stay cool, -Matthew Matthew Lee, Esq., Executive Director Inner City Press / Fair Finance Watch NCRC Board member - Global - NCRC blog... [more...]
||NCRC Global: U.S. subprime fall-out even in Africa: fewer loans, but mergers continue, Citi grows in India, lays-off in UK
NOTE: the impacts of the U.S. subprime implosion continue to spread, including in Africa, where as reflected below, lending is decreasing (but unlike in the U.S. right now, mergers continue). Meanwhile, Citigroup for example has re-affirmed its commitment to consumer finance in emerging markets like India, see below, while it has laid off subprime employees in the UK --... [more...]
||Crackdown on mortgage brokers in Australia, mergers in Russia, African development discussed at UN
Note: Below are cross-border articles, for example Australia is considering requiring the Federal registration of mortgage brokers, a step still not taken in the United States despite the U.S.'s predatory lending crisis. Also, two articles about merger approvals (like the Federal Reserve's approval today of Bank of America to buy LaSalle) -- antitrust waivers in Russia... [more...]
||Mergers: Citigroup buys Egg, Greek ATE into Serbia; GE into Vietnam
Note: Just after scaling back its consumer finance in Japan, due to tightening of consumer protection laws, Citigroup announced a propose purchase of what it calls the largest online bank, Egg. Also below, a Greek bank buying into Serbia -- at a discount, it seems clear, due to recent Kosovo status proposal release. And many banks trying to get into Vietnam, including the... [more...]
||USURY CEILINGS IN FRANCE - Deregulation had positive effects, says the Bank of France. But are Bankers’ Responses sufficient to inform the Parliament? ECRC asks for French social...
In response to a recent report by the French Central Bank on alleged outcomes for SME's as a result of lowering usury ceilings, we encourage experts to give ECRC (and the French Parliament) their opinion on this research, including experiences from outside of France. USURY CEILINGS IN FRANCE In France usury ceilings limit the interest banks can charge to consumers and... [more...]
||BANK TRANSPARENCY & EXCLUSION – Voluntary disclosure of bank lending patterns in the UK has been disappointing, a regulatory alternative may be better suited to help meet the UK’s...
A recent report by one of ECRC’s many supporting organisations nef (new economics foundation) will reinvigorate the debate on bank disclosure in the UK and help create a better understanding of why it should be demanded of banks. In a country like the UK where income disparities and social vulnerabilities are significant, a focus on improving the publicly available... [more...]
||New Banks Forming To Target Niche Markets: Number of US Ethnic-ownedbanks.
With the radical changes in demographics in this country, a new batch of de novo banks has cropped up to reach out to both recent immigrants and multi-generational ethnic markets. Though the strategy of niche marketing is by no means new, the execution is increasingly innovative as these ethnic and relationship-focused banks respond to the needs of their customers.... [more...]
||Pressing Banks for New Branches... in Ghana
NOTE: In the below, community- (and/or religious-) based groups call on banks to open branches in areas without them, not dissimilar to the Community Reinvestment Act process. What's best or most effect, it seems, is the naming-of-names of the banks... Matthew Lee, Esq. Executive Director Inner City Press / Fair Finance Watch NCRC board member; NCRC blog =... [more...]
||EXCLUSION – Pawnbroking is in vogue. The British poor are forced into Victorian-type practices as they get trapped between exclusion from mainstream credit sources and predatory...
Based on a report by Elaine Kempson from the PFRC, pawnbroking figures speak of a revival in this simple (but backward) way of borrowing money. The number of sub-prime borrowers in the UK is rising again as the 9m British being denied access to mainstream credit resort to desperate measures. The lack of alternatives available to the poor and indebteded is shocking, as they... [more...]
||NON BANKS - Developments for America's industrial loan companies shows desire for stronger control of the non banking sector.
KEEP OUT: CONGRESS TRIES TO STRENGTHEN THE BARRIER BETWEEN COMMERCE AND BANKING (July 13th 2006, from The Economist) WAL-MART has a way of upsetting people. So it was no surprise that the giant American retailer's plan to set up a bank, announced last year, met noisy opposition. Now debate may be turning to action. On July 10th a bill was introduced into the House of... [more...]
||USURY CEILINGS IN FRANCE (II) - Cofinoga/Cetelem/BNP seems to have misused the reputation of researchers to promote its deregulation policies in France - A letter from George Gloukoviezoff
Cofinoga/Cetelem/BNP seems to have misused the reputation of a reknown researcher on overindebtedness to promote its deregulation policies in France George Gloukoviezoff in a letter to ECRC has clarified that the impression which the article Cofinoga/Cetelem/BNP has published with his photo as well as the photo of Jacques Pierre from social finance in the context of its... [more...]
||USURY CEILINGS IN FRANCE (III) - Dood Respond to LaSer Cofinoga
The Dangers of the New English Disease - In the May edition of Audience, LaSer Cofinoga contend that the French system of consumer credit regulation is holding back the growth of the economy by restricting access to credit for many low income households – particularly young people – and restraining the consumption of capital goods. The edition particularly references a... [more...]
||Not Only to Lend, But Lend Fairly: Neither Alone Is Enough, in the U.S., France or Elsewhere
Not Only to Lend, But Lend Fairly: Neither Alone Is Enough, in the U.S., France or Elsewhere That banks should have a duty to serve the credit needs of poor people is the foundation of the U.S. Community Reinvestment Act, now nearly 30 years old. In the past decade it's become clear that an extra adjective is needed: FAIR credit. Banks and their affiliates have been... [more...]
||USURY CEILINGS IN FRANCE (I) - US and UK seen by French Cofinoga as Best Practice. Rules of Responsible Credit are ignored in France. Pretended alliance of credit provider with...
ACCESS TO POOR PEOPLE FOR LENDERS or ACCESS FOR POOR PEOPLE TO RESPONSIBLE CREDIT? The French financial services provider LaSer-Cofinoga (owned by the Group Galeries Lafayette and Cetelem (itself part of the group BNP Paribas) campaigns for deregulation in France and an open door to Anglo-American practices of credit extension. Usury ceilings and central database... [more...]
||Workshop to Corporate Accountability in the Financial Services organised by WEED on 13th/14th June 2006 in Cologne/Germany
Liberalisation of financial services and the effect for developing countries were the main issues of the workshop with experts from Brazil, India, the Netherlands, Great Britain and Germany from NGOs, Worker Unions, independent institutes and the German Supervisory Authority BaFin. Especially countries like India are very interesting for the financial market. Therefore... [more...]
||COMMUNITY LENDING - For South African banks, "Low-cost housing a joint challenge" - but where's civil society, the third leg of the stool?
Note: The article below, concerning social housing and banks in South Africa, is written by the director of France's international development agency, and should be viewed in that light. Still it portrays a situation on the brink of instituting infrastructure for community reinvestment. The author says that "South African banks, through the intermediary of the Banking... [more...]
||EXCLUSION: Economist article on the unbanked in America
AMERICANS WITHOUT BANK ACCOUNTS Into the fold (May 4th 2006, from The Economist) BANKS IN AMERICA ARE SEEKING OUT PEOPLE THEY ONCE SHUNNED For most of us, banking is a regrettable necessity. For many others, it is an unaffordable luxury. In America at least 12m households have no bank account—are “unbanked”, in the industry's ugly jargon. Once unnaturalised immigrants... [more...]
||Workshop 5 "Is There a Place in Europe for American-style Community Reinvestment?" presentation by John Taylor, CEO of NCRC
||COMMUNITY REINVESTMENT Reports in Europe?
The fourth directive on company transparency No 78/660/EWG required a report on the situation of the enterprise. In its Art. 46 which has since been literally transposed into German law non-financial factors have to be taken into account thus approaching the US-American system of community reinvestment information. A research of the recent results on how this has been... [more...]
||General Strategic Analysis Volkskredietbank Appingedam, Netherlands - a public bank to support overindebted people in the Netherlands
Value chain of the volkskredietbank (a public bank to support overindebted people in the Netherlands) by Harro Norder Putting the primary activities in a value chain, a simplification of the reality is there. The key job is “reallocating money” The first step is the front office department. Individuals or HR-managers of company do make a appointment. At this point... [more...]
||Biggest Banks Go Own Way on Wal-Mart Group including top five won't fight ILC, urges Fed supervision
American Banker Tuesday, March 28, 2006 By Joe Adler WASHINGTON - Some of the country's largest banking companies - including Bank of America Corp., Wachovia Corp., Citigroup Inc., Wells Fargo & Co., and JPMorgan Chase & Co. - are quietly lobbying to give the Federal Reserve Board oversight of industrial loan companies, sources said Monday. The position was... [more...]
||H&R Block: As Office of Thrift SUpervision OKs Charter Bid, Spitzer Sues
American Banker Thursday, March 16, 2006 By Jody Shenn The lawsuit Eliot Spitzer filed Wednesday against H&R Block Inc. is one in a years-long series of challenges posed by authorities skeptical of the tax preparer's effort to offer financial services to unbanked consumers. Block denied the charges, and it's too soon to tell whether this challenge will force... [more...]
||Capital One to Acquire North Fork for $14.6 Billion in Stock and Cash
Capital One Financial Corporation and North Fork Bancorporation, Inc today announced a definitive agreement under which Capital One will acquire North Fork in a stock and cash transaction valued at approximately $14.6 billion. The combined company will be one of the 10 largest banks in the United States, based on deposits and managed loans, and the third-largest retail... [more...]
||High Home Values Boost Net Worth Of U.S. Households
By RAFAEL GERENA-MORALES and JAMES R. HAGERTY March 10, 2006; Page A2 The rising value of U.S. homes boosted the net worth of American households to a record in the fourth quarter, but higher interest rates could slow home-price appreciation in the months ahead. Meanwhile, new claims for unemployment insurance rose slightly in the week ended March 4. U.S. households'... [more...]
||House to Mull Regulatory Relief Bill : Financial Services Regulatory Relief Act of 2005 is scheduled to go before lawmakers
American Banker Wednesday, March 8, 2006 By Joe Adler The House is expected to consider a bill today to ease the regulatory burden on financial institutions. The Financial Services Regulatory Relief Act of 2005 is scheduled to go before lawmakers on the suspension calendar - a status that limits debate and does not allow additional amendments. The bill, which... [more...]
||Lenders Pull Out of Mortgage Markets in Maryland, USA if a court does not bar an anti-predatory ordinance from going into effect
American Banker Tuesday, March 7, 2006 By Erick Bergquist More lenders may leave or pull back from the Montgomery County, Md., mortgage market if a court does not bar an anti-predator ordinance from going into effect there Wednesday, a Mortgage Bankers Association official said. Over three dozen lenders or securitizers have told the Maryland Association of... [more...]
||US Industry, Agencies Get Close-Up View of Storm's Effects
American Banker Tuesday, March 7, 2006 By Damian Paletta NEW ORLEANS - Despite two days of meetings and high-profile speakers, perhaps the most memorable moments for the 200 bankers and regulators at a post-hurricane conference here last week were the times when no one was talking. On Wednesday and Friday, the Federal Deposit Insurance Corp. scheduled two-hour... [more...]
||US Federal Deposit Insurance Corporation Actions Indicate Less Tolerant Stance on Payday Lending Business
American Banker Monday, March 6, 2006 By Ben Jackson The Federal Deposit Insurance Corp. insists it is not forcing banks it regulates out of the payday lending business, but its recent actions suggest otherwise. In the last two weeks First Bank of Delaware and Republic Bancorp Inc. of Louisville announced they were getting out of payday lending under pressure... [more...]
||Hearings Set on Housing, Reg Relief in the Gulf Coast Region
The House Financial Services subcommittee on housing and community opportunity has scheduled a hearing for today on Gulf Coast housing issues. Among those scheduled to testify are Kim Kendrick, the Department of Housing and Urban Development's assistant secretary for fair housing and equal opportunity, and Janet Murguia, the president of the National Council of La... [more...]
||US Bankers on Gulf Coast Seek Help from Around the Country including purchasing the mortgages of storm-affected banks on the secondary market, creating more loan participations, and...
American Banker Friday, March 3, 2006 By Damian Paletta NEW ORLEANS - Gulf Coast bankers reached out to large institutions across the country Thursday, asking for various kinds of help to recover from last summer's hurricanes. At a conference with close to 200 bankers and regulators, local representatives told how outside banks could assist, including... [more...]
||The most effective marketing efforts to reach the unbanked are those that offer a sense of community. This appeal can also help keep existing customers.
More than 13 percent of the nation's 105 million households have infrequent or nonexistent relationships with financial institutions, according to a study published last year by Global Advertising Strategies of New York. This unbanked segment consists largely of immigrants and ethnic minorities, as well as youths, widows, divorcées without their own credit histories and... [more...]
||EXCLUSION: Access to banking services in the UK is criticised by Citizens Advice.
BANKS ARE YET TO DELIVER ON FINANCIAL INCLUSION, SAYS CITIZENS ADVICE REPORT Posted by Lucy Cochrane on Tuesday, January 24th, 2006 at 05:01 PM Banks are merely paying lip service to helping their most vulnerable customers and would-be customers. BANKING BENEFITS A bank account is now essential to everyday life: yet one in 12 households - 2.8 million adults - in the UK... [more...]
||RESPONSIBLE CREDIT - Discussions take place in France. The French paper reported on a Franco-American meeting on the theme of Community Reinvestment -
A legislative concept based on universal access to credit, with no equivalence in Europe. Held in Paris, the event pitted together French local bankers and government representatives with experts in the field from across the Atlantic.The interest displayed on the subject, by the mere existence of this meeting, is further indication that there may in fact be grounds for... [more...]
||COMMUNITY REINVESTMENT - Smaller US banks could become less accountable if rules of the CRA are relaxed for them. Society should know how and to whom banks lend.
TIME FOR A RETHINK (Mar 3rd 2005 from The Economist) THE RULES REQUIRING BANKS TO SERVE LOW-INCOME AREAS ARE CHANGING Banks, perhaps even more than other businesses, are almost certain to be keener on serving the rich than the poor. In America, however, the law makes them curb their instinct a little. Since the Community Reinvestment Act (CRA) was passed by Congress in... [more...]