| Beware the credit card rate sting
CREDIT CARDS offer banks the ideal vehicle to discreetly lift interest rates above official Reserve Bank levels. Experts say some lenders are lifting credit card rates by more than half a percentage point despite the Reserve Bank's lifting the official rate by 0.25 per cent. The Commonwealth Bank has lifted credit card interest rates by 0.65 per cent on some products, according to financial services provider, Infochoice. It found that BankWest had lifted rates on its Zero MasterCard by 1 percentage point to 14.99 per cent. Other financial institutions have stuck to a 0.25 per cent rise, but analysts warn they could easily rise. Banking analyst Jarrod Martin, of ABN Amro, said financial institutions had started lifting credit card interest rates before the Reserve Bank's official rise earlier this month.
Local lenders' business loans going bad
Bad loan writeoffs are surging at Chicago banks, a sign that housing market troubles are spreading to small and mid-sized businesses. The area's second- and third-largest banks LaSalle Bank N.A. (now owned by Bank of America Corp.) and Harris N.A. wrote off business loans through Sept. 30 at more than twice the rate of last year, according to financial statements. As a group, the 15 largest local banks that disclose Chicago-specific data wrote off $84.3 million in business loans, about double the figure for the first three quarters of 2006. Although loans to commercial real estate developers took a turn for the worse early this year, lending to other businesses has been seen as safe. The writeoffs haven't reached levels that dent banks' earnings, but many bankers expect credit quality to further deteriorate this year and well into 2008 as the economy continues to soften.
The CNN Wire: Wednesday, Oct. 31
7 killed in suicide attack in Pakistan's eastern province (CNN) -- A suicide bomber rammed his motorcycle into a Pakistani air force bus, killing at least seven people and wounding 30 others Thursday, police told CNN. Some of the dead included air force personnel, police said, although they did not specify a number. The attack occurred near Sargodha, a city in eastern Punjab province.(Posted 2:05 a.m.) Talks between Hollywood writers and producers break off LOS ANGELES (CNN) -- Contract talks broke off between Hollywood writers and producers Wednesday evening, ahead of a midnight deadline for their current labor package to expire. There were no immediate plans for the 12,000 members of the Writers Guild of America to strike and the Alliance of Motion Picture and Television Producers said no talks were scheduled for Thursday.
Citigroup CEO Prince resigns, replaced by Robert Rubin
NEW YORK -- Citigroup Inc. Chairman and Chief Executive Charles Prince, beset by the company's billions of dollars in losses from investing in bad debt, resigned Sunday and is being replaced as chairman by former Treasury Secretary Robert Rubin.The nation's largest banking company announced Prince's widely expected departure in a statement following an emergency meeting of its board. Citi also said Sir Win Bischoff, chairman of Citi Europe and a Member of the Citi management and operating committees, would serve as interim CEO. Rubin, a former co-chairman of Goldman, Sachs & Co., has served as the chair of Citi's executive committee, and it was also expected he would take a greater role in leading the company.In a separate statement, Citi, which took a hit of $6.5 billion from asset writedowns and other credit-related losses in the third quarter, said it would take an additional $8 billion to $11 billion in writedowns.“It was the honorable course, given the losses we are now announcing," Rubin said of Prince's resignation in an interview with The Associated Press.Prince joined former Merrill Lynch & Co.
Napa supplier of bank investment software on a growth path
NAPA � An 18-year-old broker-dealer is reaping the benefits of growth in investment services offered by banks and credit unions.
Napa-based Essex National Securities Inc. supports the sale and management of stocks, bonds, annuities and other investments by more than 40 financial institutions around the country, focusing on those in the range of $250 million to $30 billion in assets.
Last year, it launched new software that allows institutions to integrate customers� investment portfolios into their online banking systems, creating a one-stop Web site for financial services.
�A lot of financial institutions that are in our target market don�t have that capability right now, and we�re just introducing it,� said Scott Davis, president and CEO for ENSI.
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