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Wal-Mart's Application into Banking
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"Wal-Mart Announces Plan to Enter |
UPDATE: On 3/16/07, Wal-Mart announced it is withdrawing its application into banking. Read the most recent articles below to find out why.
For the first time, the Federal Deposit Insurance Corporation (FDIC) held public hearings on Wal-Mart’s application for an industrial loan company (ILC) charter in Utah.
So what's an ILC and why does it matter?
ILCs are regulated differently than banks because they were originally small entities permitted by a loophole in the Bank Holding Act. If Wal-Mart, the world’s largest retailer with a history of unethical business practices, is granted access into banking via an ILC charter, there will be far-reaching consequences beyond the original intent of the act. If Wal-Mart charters in Utah, a Wal-Mart bank could branch out into more than 20 states because of state reciprocal branching laws. While Wal-Mart denies it plans to enter retail banking, its previous applications contradict their current publicly stated plans.
Approving the Wal-Mart application risks not only undermining the separation between commerce and banking, but threatens an expansion of “Wal-Mart banks” in multiple states, and in multiple aspects of the banking industry.
Read letters, press releases, articles and statements on the issue:
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3-24-07: WAL-MART GIVES UP ON FIGHT FOR BANK
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New York Times 3-16-07: Wal-Mart Drops Bid to Operate Its Own Bank
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Forbes 3-16-07: Wal-Mart withdraws Industrial Loan Company charter application
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Wall Street Journal 10/21/06: On the Shelf: How Broad Coalition Stymied Wal-Mart's Bid to Own a Bank
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Congressional letter to the FDIC urging a moratorium >>> Click Here
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UFCW Statement on the FDIC's Decision to Hold Hearing on Wal-Mart's Application into Banking >>> Click Here
- Statement of the Sound Banking Coalition on the Senate Banking Committee Hearing "Consideration of Regulatory Relief Proposals" >>> Click Here
- Letter from Alan Greenspan to Congressman James Leach
>>> Click Here - Press Release from the Office of Congressman James Leach
>>> Click Here - Press Release from the National Association of Realtors (NAR) on Maintaining the Separation Of Banking & Commerce >>> Click Here
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