Bank News

• Credit Card Delinquencies and Charge-Offs Soaring: AP Study
  U.S. consumers have been falling behind on credit card payments in the last year, prompting double-digit growth in the percentage of delinquent and charged-off accounts over that time period, according to an analysis from the Associated Press. The largest growth was in accounts that are 90 days or more late in payments which could mean that the worst is still to come, say some experts. The AP examined credit card trusts from 17 large credit card issuers and compared the numbers from October 2006 to October of this year. The accounts covered in the analysis make up about 45 percent of all outstanding credit card accounts in the country. The news organization found that the value of credit card accounts that were at least 30 days late in payments jumped 26 percent in the period. The total value of these delinquent accounts was $17.3 billion. Charge-offs rose 18 percent to a total of $961 million. Anecdotal evidence from the AP showed that a handful of large issuers – including Advanta, GE Money and HSBC – reported increases of more than 50 percent in accounts that are 90 days or more delinquent. Other card issuers named in the study include Bank of America, JPMorgan Chase, Capital One, American Express and Discover Financial. Retailer-branded private label cards from Wal-Mart, Home Depot, Lowe’s, Target and Circuit City were also covered. JPMorgan Chase was the only issuer to buck the trend, with its trust showing a decline in delinquencies and charge-offs from October 2006 to October 2007. Mark Zandi, chief economist of Moody's Economy.com, told the AP that the mortgage meltdown and subsequent crunch in real estate values is a main driver for the poor card performance, and that the problems would continue. "Credit card quality will continue to erode throughout next year," Zandi said.
• Discovers UK Problems Lead to $84 Million Loss in Quarter
  Discover Financial Services reported today a net loss in its fiscal fourth quarter of 2007 of $84 million, partially due to a $391 million impairment charge related to its Goldfish card in the United Kingdom. Discover earned $186.5 million in the fourth quarter of 2006. For its full fiscal year 2007, Discover reported net income of $561 million, without the impairment charge. Card receivables in the U.S. totaled $48.2 billion, up 5 percent from a year ago. The managed credit card net charge off rate in the fourth quarter was 3.84 percent, down 15 basis points from the same period a year ago. The 30-day delinquency rate was 3.59 percent, a rise of 20 basis points from a year ago. Volume on Discover’s payments network in its fourth quarter reached $25 billion, up nearly 28 percent. For the year, payment volume totaled $91.7 billion, up 25 percent from fiscal 2006. Discover increased its provision for loan losses to $339.9 million, up nearly 42 percent from the same period a year ago. The increase was due to a return to a more normal level of bankruptcies following the decline in 2006, and a higher number of loans on the books, Discover reported. The international card division reported a pretax loss of $423 million in the quarter, including the impairment charge. The fourth quarter charge off rate was 6.65 percent, up 85 basis points from a year ago. The managed 30 day delinquency rate was 5.25 percent, up 67 basis points from a year ago.
• PR - RentBureau Data Added to SelectRent
  Atlanta-based RentBureau, the first national online repository of rental payment histories, has aligned with RHR Information Services, Inc. to make apartment rental payment histories available as part of SelectRent, RHR’s comprehensive residential screening service, announced Bill Garrity, RentBureau, senior vice president of Member Services. Through its alliance with RentBureau, multifamily owners and managers using SelectRent will have access to over three and a half million rental payment records available through RentBureau’s National Rental Data Exchange (NRDE) database. “By adding RentBureau’s rental payment data to our reports, we can provide our clients with a wider, more comprehensive view of potential residents’ ability to pay rent, thereby reducing their risk of skips, evictions, and bad debt,” said Tony Karels, National Sales Manager for RHR Information Services. SelectRent is currently used by the owners and managers of over 100,000 apartment units in Minnesota. RentBureau’s rental payment data will be used by Minnesota apartment owners and managers to make informed leasing decisions that will improve the value of their properties,” said Garrity. “RHR Information Services recognizes that previous rental histories are a great predictor of future rental payments.” RentBureau is the first national system providing apartment owners and managers with accurate and current rental payment histories of apartment residents and applicants. Every 24 hours, RentBureau automatically and securely collects resident rental payment information from its members’ existing property management software. RHR Information Services is a leader in pre-employment and residential background screening services in the Midwest marketplace.
• PR - TSYS Announces Update on Spin-Off from Synovus
  Columbus, Ga.-based TSYS (NYSE:TSS), one of the world’s largest providers of outsourced payment services, today announced that TSYS shareholders as of the close of business on Dec. 17, 2007 will receive $3.0309 per share, which represents the pro rata portion of the previously announced one-time special cash dividend of $600 million to be paid in connection with the spin-off to Synovus’ shareholders of the shares of TSYS stock currently owned by Synovus. This per share amount is based on the number of TSYS shares outstanding as of the close of business on Dec. 17, 2007. The dividend will be paid on Dec. 31, 2007. As previously announced, TSYS has been advised that, in connection with the spin-off, a “when-issued” public market for TSYS common stock on the New York Stock Exchange (NYSE) is expected to begin on or around Dec. 19, 2007, and continue through the distribution date under the symbol “TSS wi.” The “when-issued” public market will be a market for shares of TSYS common stock that will be distributed to Synovus shareholders on the distribution date. In addition, TSYS expects to be quoted "ex-dividend" on the NYSE beginning on or around Dec. 19, 2007. ]Any holder of TSYS common stock who sells shares of TSYS (which currently trades on the NYSE under the symbol “TSS”) in the “regular way” market before the date "ex-dividend" trading begins will be selling the entitlement to receive the special cash dividend and regular quarterly cash dividend. Holders of TSYS common stock are encouraged to consult with their financial advisors regarding the specific implications of selling TSYS common stock before the date "ex-dividend" trading begins.
• PR - Foreclosures Rise 68% from Year Ago
  RealtyTrac, an online marketplace for foreclosure properties, today released its November 2007 U.S. Foreclosure Market Report, which shows a total of 201,950 foreclosure filings — default notices, auction sale notices and bank repossessions — were reported during the month, down 10 percent from the previous month but still up nearly 68 percent from November 2006. The national foreclosure rate for the month was one foreclosure filing for every 617 households. “The 10 percent drop in November is the first double-digit monthly decrease we’ve seen since April 2006,” said James J. Saccacio, chief executive officer of RealtyTrac. “This could indicate that foreclosure activity has topped out for the year, but the true test of whether this ceiling will hold will come at the beginning of next year — when we anticipate that a seasonal surge in foreclosure filings and another possible wave of resetting mortgages could place further pressure on the housing market." Nevada, Florida, Ohio post top state foreclosure rates With one foreclosure filing for every 152 households — more than four times the national average — Nevada continued to register the nation’s top state foreclosure rate for the 11th straight month. A total of 6,694 foreclosure filings were reported in the state for the month, up 1 percent from the previous month and up 167 percent from November 2006. Florida’s Novemb