News

New York Times | Tuesday, February 18, 2014

Shoddy paperwork, erroneous fees and wrongful evictions are cropping up among the servicers that collect mortgage payments. Servicing companies like Nationstar and Ocwen Financial now have 17 percent of the mortgage servicing market, up from 3 percent in 2010. The servicing companies are unfettered by many regulations which apply to banks. Because of those regulations, banks are eager to hand off some of their more challenging loans. Federal and state regulators worry that the rapid growth could create new setbacks like stalled modifications for millions of Americans. Analysts say the specialty servicers have not upgraded their technology or infrastructure to accommodate the glut of new mortgages. Some regulators say the servicers benefit when they work through the troubled loans as quickly as possible, raising questions about whether the companies are pushing homeowners into foreclosure.

Wall Street Journal | Tuesday, February 18, 2014

Costs associated with the Target security breach have topped $200 million for financial institutions, according to data collected by the Consumer Bankers Association and the Credit Union National Association. The tally by the industry trade groups is the most comprehensive so far in identifying the breach's impact on banks and others. With the credit card data of an estimated 40 million shoppers exposed in the attack, banks have gone on a massive spree of new-card issuance: more than 17 million new credit cards have been sent out to customers. Replacing credit cards costs an average of $10 per card, not taking into account the cost of any fraudulent activity done with the stolen card numbers. But for banks, there is an even bigger card-replacement cycle approaching: October 2015 is a major deadline in the planned shift to microchip-enabled credit cards.

The New Yorker | Tuesday, February 18, 2014

Lisa Sevron, a professor at the Milano School of International Affairs, Management, and Urban Policy at the New School, describes the experiences of payday borrower Azlinah Tambu, a twenty-two-year-old single mother: Ms. Tambu's car had broken down, and she needed it to drop her daughter off at day care and get to work. Tambu had no savings or credit card; no family or friends who could help. So she took out five payday loans from five different lenders knowing she would not be able to pay them back on time. When the lenders tried to withdraw the money she owed from her checking account, she did not have sufficient funds and was hit with overdraft fees that mounted to $300. Tambu paid off the overdraft charges and closed her account. Still, Ms. Tambu feels the loans were a necessary evil. “I think they should still exist," she said. "You know it’s undoable to take out five loans and be able to pay them back. But sometimes you have no choice. The reason I’m working so hard to pay these loans back is that I want to be in good standing, in case I ever need another one."

Washington Business Journal, City First Bank of DC | Wednesday, February 12, 2014

Brian Argrett, President and CEO of City First Bank of DC, has been named a recipient of the Washington Business Journal’s 2014 Minority Business Leader Award. The award recognizes the top 25 minority business leaders in the Washington, D.C. area, honoring their entrepreneurial drive, creativity and success. Mr. Argrett, also CDBA Vice-Chair, was recognized for bringing financial services to the underserved and for his expertise growing companies in under-resourced and minority communities. Under his leadership, City First Bank has grown to over $200 million in assets and significantly increased its capabilities and impact in under-resourced communities. He also led City First Bank and its affiliates in organizing a new city-wide finance summit, a forum for discussion among urban planners, government officials, developers, community groups and financial institutions around the topics of economic parity and inclusion within a rapidly changing city.

Promontory Financial Group | Tuesday, February 11, 2014

On March 7, 2014, at 1:00 PM EST Promontory Financial Group will host a conference call to answer frequently asked questions about the Promontory Empowerment Awards. Topics covered in the call will include award eligibility, application requirements, selection criteria and prizes. All interested in attending are advised to RSVP to empowerment@promontory.com for dial-in information and to submit questions for consideration during the call. Questions should be submitted by 5:00 PM EST on March 5. Promontory established the empowerment awards to recognize and support promising innovations which broaden access to safe, fair financial services. Awards will be offered in two categories: one for registered CDFI banks and another for financial and technology firms with less $10 billion in assets. Prizes will include consultations with Promontory and financial awards. More information and application materials are available at empowerment.promontory.com.

Virginia Community Capital | Tuesday, February 4, 2014

Virginia Community Capital President/CEO and CDBA Chairwoman Jane Henderson has been named one of three new board members by the Center for Rural Entrepreneurship. Based in Lincoln, Nebraska, the Center for Rural Entrepreneurship works in partnership with communities in the United States and Canada to provide customized research-based, asset-focused economic development strategies that emphasize entrepreneurship. Current board chair Thomas S. Lyons  said of the transition, “We are excited about the addition of these three members who bring deep experience with entrepreneurship and community development... We look forward to the talents and energy they will bring to our board.”

| Wednesday, December 25, 2013

OneUnited Bank has introduced a new credit card aimed at consumers who are trying to repair bad credit. The credit card, billed as the “comeback card” will initially be marketed in the bank’s three primary locations -- Boston, Los Angeles, and Miami -- said Teri Williams, the bank’s president. As customers establish a history of on-time payments, they can rebuild their credit, allowing them to qualify for traditional cards and other loans. “These are people who have hit a bump in the road,” Williams said. “We can relate, whether personally or as an institution, when you hit a bump in the road. The message that we would like to send is that you can come back from that.” said OneUnited President Teri Williams.

| Thursday, December 19, 2013

Alongside its announcement of the closure of its South Shore branch, Urban Partnership Bank has announced the launch of a new online and mobile banking platform, "upbAnywhere." The bank will offer free courses in January to train its customers to use the new platform. Urban Partnership also announced plans to refocus on small-business and real estate lending, and to participate next year in a foreclosure-prevention program backed by the Illinois Housing Development Authority. "We believe these are the right strategies... They better align our structure and business focus with the needs of our customers and communities, and in so doing, position us for long-term success," said William Farrow, the bank's chief executive.

| Thursday, December 19, 2013

A new service from Carver Bancorp that offers check cashing to non-customers from automated kiosks reflects a shift in the banking industry toward check cashing. The shift comes as payday lending comes under increasing fire from regulators and banks seek alternate sources of fee income. Carver's program brings the kiosks, which resemble ATMs, to the sites of employers on paydays, making it easier for the unbanked to access check cashing. Deborah Wright, Carver's chairwoman and chief executive, hopes to expand the kiosk program, which she forsees broadening the bank's outreach to underbanked consumers.

| Monday, December 16, 2013

Three years after taking over the assets, deposits and mission of failed low-income neighborhood lender ShoreBank, Urban Partnership Bank is selling the converted movie theater in Chicago's South Shore neighborhood that served for decades as home to ShoreBank. The sale means Urban Partnership Bank will no longer have a physical presence in South Shore. Urban Partnership Bank CEO William Farrow commented that the bank continues to hold property in South Shore which he expects to eventually develop into a renewed presence in the neighborhood.

Pages