1: CAST SERVICE HIGHLIGHT

Branch Optimization
Effectively manage productivity, customer service and staff resource levels

As service providers aggressively expand product and service offerings, the branch delivery channel takes on new importance. Companies, particularly banks, frequently overlook the interdependencies of appropriate skill sets, staff levels, processes and physical branch configuration. The situation is further complicated in situations where multiple companies are being merged. A holistic view is essential in optimizing branch staff levels. Organizations continue to struggle with excess cost and ineffective productivity management in their branch networks.

Factors Influencing Branch Staff and Productivity Management

• Inability to effectively forecast workload and accurately schedule resources based on service delivery targets and sales opportunities
• Limited understanding of the implications of delivering new products and services
• Inefficiencies from merging disparate operations, technologies and staffing practices
• Failure to educate staff and customers on alternative processing options
• Limited understanding of the implications of newly installed technologies
• Inefficiencies resulting from recent arbitrary, across the board staff reductions
• Incomplete performance metrics

Why CAST for Branch Staffing Optimization

• Over 15 years experience reengineering branch office processes in banking, insurance and capital markets
• Superior data capture and analysis methodology
• Proven approach to developing staffing standards and performance metrics
• Comprehensive staffing models
• Demonstrated expertise in organization design
• Collaborative approach which actively involves branch personnel
• Established implementation tools and techniques
• Proven tools for monitoring and measuring benefit

If you would like additional information, please contact Tom Vleisides at (213) 614-8066 ext. 244 or email tvleisides@castconsultants.com.

2: AMERICAN BANKER - A Direct Line from CRO to Boardroom

For chief risk officers at banking institutions, having the ear of the chief executive has proven necessary but not sufficient.

To really be effective, companies also need to make sure that their CROs have unobstructed access to their boards, and vice versa.

Those lines of communication, if they weren't open before, certainly are open now at many banks. At Fifth Third Bancorp, for example, CRO Mary Tuuk has regular executive sessions with the board's risk and compliance committee, without any other members of management in the room, and meets monthly with the committee chair, again without other management present.

Tuuk has had what she calls a "dotted-line reporting relationship" with the risk committee since its inception in 2003, and she also makes presentations at regular meetings of the full board.

Risk management experts and corporate governance watchdogs say that those kinds of interactions provide an added aura of authority for CROs, and another layer of controls within a company. And even then, things may still go awry. But as companies reassess their tolerance for risk and the ways to apply it to decisions ranging from loan approvals to executive bonuses, maintaining a CRO-board dialogue — even after the financial crisis passes and the scrutiny of risk management practices comes down from its current red-alert level — will remain critical.

"There seemed to be minimal or nonexistent two-way access, or even one-way access, between boards and CROs at many of the large banks when we've looked at them in years past," said Patrick McGurn, special counsel on corporate governance issues for the advisory firm RiskMetrics Group Inc. "Coming out of this meltdown of the sector … there has been a recognition that there are going to have to be these lines of access."

The recognition appears to have spread quickly. In a 2009 Deloitte LLP global survey of 111 financial institutions, 53% said their CROs reported directly to the CEO, up from 42% in 2006. The percentage of respondents who said their CROs have a reporting relationship with the board or a board-level committee — either in lieu of or in conjunction with a direct reporting line to the CEO or another officer — jumped from 37% to 52%.

McGurn said he sees "a lot of resignation" on the part of CEOs that directors are "likely to be more noses-in on these issues now." Directors, meanwhile, are scrambling to get up to speed on risk issues they may have glossed over in the past. And risk managers themselves are glad for the attention to their work, and for the extra influence they can wield when empowered with access to the board.

While reporting into a CEO generally is "viewed positively" by risk officers, many want the additional option of dealing directly with boards, said Emma Hawkins-Haile, whose London search firm, Hawkins Haile, places risk professionals at financial firms around the globe.

"I have definitely seen in my high-level candidates great concern around whether or not the role reports directly into the board, as they believe this is often evidence of how seriously the organization takes risk and has it as an embedded part of their organization," she said.

Veteran risk manager William Martin knows how important the power of board access can be, as someone who has been granted it, stripped of it and bestowed with it again.

When he joined the old NatWest Group years ago, Martin was thrilled to have the opportunity to make regular board presentations, a task he described as terrifying but exciting. When the firm got taken over by Royal Bank of Scotland Group PLC, which had a different governance structure, his contact with the board stopped.

"Losing that report into the board took away a lot of my authority," Martin said this month at a conference of the Global Association of Risk Professionals, for which he is trustee board chairman.

In an interview from his office at Commonfund, the asset manager where he now serves as chief risk officer, Martin said he once again has a line into the board, reporting into the vice chairman and audit and risk management committee as well as the firm's CEO.

"That direct report adds credibility and responsibility to the role of the CRO," Martin said. "In reporting to the CEO, you're talking about hard things — numbers, analysis, capital, potential losses. Reporting to the board, you're talking about what I would call softer things — you're talking about ethics, you're talking about risk appetite. In practice, the softer issues are the harder issues."

Hank Prybylski, global financial services risk management leader at Ernst & Young LLP, said some banks have taken the idea of board access even further, extending the dialogue to executives outside the risk function.

"One of the best practices we'll hear from board risk committees is that you shouldn't just talk to the CRO but that you should also be talking to the heads of the business," Prybylski said.

"The heads of the businesses own the risk. The CRO is a lens into the organization [but] shouldn't be the only touchpoint for a board committee."

3: AMERICAN BANKER - Broker-Dealers Fear Bills That May Upset Adviser Links

Cambridge Investment Research's 1,600 financial advisers are independent contractors who run their own businesses, but legislation introduced in both the House and Senate is threatening that business model.

4: AMERICAN BANKER - Fate of Home Loan Banks May Lie with Fannie and Freddie

The Federal Home Loan banks have always had an uneasy relationship with Fannie Mae and Freddie Mac, but the fate of the government-sponsored enterprises are more entwined than ever as Congress considers the future of housing finance.

The House Financial Services Committee will meet on March 2 to debate the future of the GSEs and the housing market more broadly. The conclusions lawmakers reach about Fannie and Freddie will have major implications for the Home Loan banks, including how they sell their debt and who regulates them.

"So much of what will happen to them depends on what Congress is going to do with Fannie and Freddie," said Bert Ely, an independent consultant in Alexandria, Va. "This gets back to the core problem of what do you do with Fannie and Freddie?"

Though Fannie and Freddie have become symbols of the financial crisis, the Home Loan banks have not gone unscathed. The state of the system will be clearer in the coming weeks when they release their 2009 annual reports. But the Home Loan banks have grappled with big losses related to private-label mortgage-backed securities; the system lost $165 million during the third quarter.

"They're out of control, too," said Paul Miller, a managing director at FBR Capital Markets Corp. "They don't have an effective regulator and they need to be reined in, because there's a lot of Home Loan bank debt out there."

But for all the system's woes, it never needed money from the Troubled Asset Relief Program. And while Fannie and Freddie have tapped a combined $111 billion from a credit line at the Treasury Department, the Home Loan banks have never borrowed a dime.

Home Loan bank leaders hope to use their success to their advantage by informing the debate over GSE reform — not become a victim of it.

"It's not possible to talk about GSEs without talking about the only successful housing GSE," said Alfred DelliBovi, the president of the Federal Home Loan Bnak of New York. "You've got three housing GSEs, and now two of them are wards of the state. I'm not pointing fingers, but the natural thing is to point to what works and what doesn't work."

House Financial Services Committee Chairman Barney Frank said last month he supports "abolishing Fannie Mae and Freddie Mac in their present form and coming up with a whole new system of housing finance."

Though development of that new system is barely off the ground, Home Loan bank officials said policymakers should consider the advantages of a cooperative structure.

"We are a system built on a cooperative structure, in which the 12 Home Loan banks and their members have their own capital at risk," said John von Seggern, the president of the Council of Federal Home Loan Banks. "That's a core principle of any new financial structure."

Prospective Home Loan bank members must make a capital investment to join the system and provide additional capital when they borrow advances. DelliBovi said Fannie and Freddie could operate on a similar basis by requiring capital from institutions that pass their loans on to the GSE.

"Those organizations have to lend capital to the enterprise so you can't just dump the mortgage at the GSE," he said. "They should have to buy capital just like members of the Home Loan banks who take out advances do."

Outside observers agreed that a self-capitalization framework akin to the Home Loan banks might be the best solution for Fannie and Freddie.

"The big question for housing finance is how do we recapitalize the GSEs, and I think the Federal Home Loan banks offer a great answer to that question," said Fred Cannon, the co-director of research at KBW Inc.'s Keefe, Bruyette & Woods Inc. "The GSEs can essentially become cooperatives of banks who originate mortgages. Part of the mortgages would be a haircut that would go in and recapitalize the GSEs."

But even if Congress goes along with the cooperative structure, big changes could be in the offing for the Home Loan banks.

The system is regulated by the same agency as Fannie and Freddie — the Federal Housing Finance Agency — but the type of oversight could be changed if Fannie and Freddie are privatized or nationalized.

Since Home Loan bank debt is typically traded closely to debt issued by Fannie and Freddie, Cannon said financial markets would want to see the Home Loan banks treated in the same manner as the larger GSEs.

"Federal Home Loan banks are GSEs just like Fannie and Freddie are," Cannon said. "A best-case solution would be they would be structured very similarly."

While policymakers could seek to split oversight of the Home Loan banks from Fannie and Freddie, they were only combined two years ago, and breaking the banks off again could be problematic.

"For now that's unlikely, because we just melded them all together," said Jom Vogel, the head of fixed-income research at First Horizon National Corp.'s First Financial Capital Markets Corp.

"To split them back up is going to be overly complicated. The idea that there's a Home Loan wing of FHFA and a Fannie/Freddie wing of FHFA seems to sit well right now."

DelliBovi said he would not oppose separating Home Loan bank oversight from supervision of Fannie and Freddie. But he said that must be done in a way that does not spook debt investors.

"We wouldn't want the debt investors to think we are in any way inferior to" Fannie and Freddie, he said. "Debt has to be a consideration that we wait and watch carefully."

Still, he said he expects changes to Home Loan bank oversight in the coming years. Since the Treasury has given so much money to Fannie and Freddie, DelliBovi predicted the Finance Agency would become part of the Treasury. That would be similar to the construct of the Office of the Comptroller of the Currency and the Office of Thrift Supervision.

"I wouldn't be at all surprised to see the FHFA become part of Treasury," DelliBovi said. "If you're sitting in Congress, you say, 'They've spent a lot of money, and it's going to take them a while to get their money back.'"

The GSE reform efforts could also give lawmakers a chance to press for consolidation within the system, especially among weaker banks like those in Boston, Chicago and Seattle. But consolidation efforts have not paid off in the past — the Chicago and Dallas Home Loan banks spent nearly a year debating whether to merge — and DelliBovi questioned whether combining banks would really solve any problems.

"They have a bellyache," he said. "I'm not sure that consolidation is the right cure for a bellyache. If you consolidated two of them — one strong, one weak — there'd be a price to pay to be the weaker one with shareholders."

He went on: "It's not going to happen because of anything other than an economic need to consolidate.

5: AMERICAN BANKER - Get Ready for Rising Rates

Bankers cannot wait until the inevitable rise in interest rates before deciding how they plan to handle it. That's the consensus among regulators, who are increasingly concerned about institutions getting caught off guard as the unprecedented low rates start to normalize.

It's enough of a worry that the Federal Deposit Insurance Corp. had a day-long conference in late January devoted solely to interest rate risk management. The trouble is that some institutions holding on to long-term assets are relying too heavily on cheap short-term funding. "I'm afraid that the risks of this business model will become all too clear when interest rates rise, or the yield curve flattens," FDIC Chairman Sheila Bair said at the conference.

Fallout from sharply rising interest rates helped cause hundreds of thrift failures in the late '70s and '80s, as rates climbed to as high as 20 percent. At that time, thrifts primarily held long-term assets - 30-year, fixed-rate mortgages - which elevated risk because many were funded with short-term liabilities. Nobody is predicting the impact on the industry will be of the same magnitude this time around. But some institutions are likely to suffer nonetheless.

"You have losses occurring in the loan portfolio on the asset side. When you compound that with the rising-rate environment and compressing margins, that could create a situation where you're having even greater depression of earnings," says Charles Vice, commissioner for Kentucky's department of financial institutions. "Do we have a lot of banks that this could potentially cause to fail? No. Do we have a lot of banks that this would compress their earnings stream and make it more difficult to augment capital? Yes."

William Haraf, the banking commissioner in California, isn't sounding the alarms just yet. "If interest rates move sharply, the impact could be very substantial. But I want to emphasize that that is 'if' interest rates move sharply," he says. "It's just a generic concern."

Among federal banking agencies, the FDIC has been the most vocal in its concern. In a Dec. 17 Supervisory Insights publication, FDIC officials warn that some institutions, in the process of chasing earnings during the low-rate period, may have taken on substantially more risk. The report noted an increase in assets with extended maturities. Whereas such assets made up just 24 percent of the industry's total in 2006, that figure was near 40 percent in June 2009. Meanwhile, noncore funding, which the FDIC regards as less stable and vulnerable to interest rate changes, remains popular with institutions with longer-term assets. Smaller institutions are also increasing their use of long-term mortgages as they hold fewer construction and development loans. A joint agency advisory urges institutions to do stress tests to gauge their interest rate risk.

George French, the deputy director of policy in FDIC's division of supervision and consumer protection, says that while regulators are not predicting a "crisis situation," there are some institutions that "do appear to be getting a little more extended" on interest rate risk.

Kerri Corn, the director of market risk in the Office of the Comptroller of the Currency's credit and market risk division, called the agencies' joint advisory "a shot across the bow."

"We started off the guidance saying, 'We understand you take on interest rate risk. It's what you do. It's part of your business. Just do it wisely,'" says Corn. "Do we see it as a big issue right now? We do not."

Even Vice, the Kentucky commissioner, says he remains more worried about asset quality. "Most of our banks would be able to weather an impact to earnings with rates increasing a lot better than they've been able to absorb some of these asset-quality problems," he says.

Regulators are urging banks with disproportionate levels of short-term funding and long-term assets to recalibrate. "Banks, when they realize they have a mismatch, can replace investments that roll off through organic growth with shorter-term investments," says Kyle Hadley, the chief of examination support in the FDIC's division of supervision and consumer protection. "They could also try to extend their funding profile, issuing longer-term CDs or obtaining longer-term borrowings. If the bank is capable of certain reasonable interest rate risk hedging, we're not discouraging that if it is within their means."

6: AMERICAN BANKER - Gluttons for Capital

If there is any trend in raising capital these days, it could be simply that so many banking companies are doing it - or hoping to.

Why they need more capital is simple. Healthy companies want to repay the federal government or buy failed banks. Regulators are also pressuring many banks, not just troubled ones, to fatten their capital cushions.

How they are going about it varies widely. Those that can sell common stock generally are, though sometimes at a steep discount to their trading price. Struggling companies have had to get more creative, with debt-for-equity exchanges becoming an increasingly popular option.

Still, many banks cannot find capital at all. Far less private equity is chasing deals than the hype suggests, industry observers say. And traditional capital-raising tools, like bank-holding-company loans and trust-preferred securities, are no longer an option in most cases.

No quick fixes are likely, even as the economy improves, says Max Neukirchen, a partner in the corporate and investment banking practice at the consulting firm McKinsey & Co. He expects the capital scramble to take years to play out. "Capital is scarce and will remain scarce," he says.

Kenneth Kohler, a partner at the law firm Morrison & Foerster LLP, agrees, saying community banks are having more of a challenge attracting investors than large ones, and private banks are getting less interest than publicly traded ones.

"People are resorting to a whole variety of techniques to raise capital, and even so, a lot of banks, particularly smaller ones, can't do it," he says.

First Financial Bancoro., Flagstar Bancorp Inc. and Midwest Banc Holdings Inc. all took steps to bolster their capital in January, each in their own way and for different reasons.

The thriving $6.9 billion-asset First Financial talked of buying more failed banks and repaying funds it received from the Troubled Asset Relief Program, as it sold common stock for the second time in less than a year. The Cincinnati company ended up raising $96.5 million.

A public offering was not an option for the beleaguered Flagstar of Troy, Mich., which lost nearly $500 million last year. It secured a $300 million infusion from private-equity investor MatlinPatterson Global Advisors, to go along with a rights offering. MatlinPatterson also put $350 million into the company last year.

And Midwest of Melrose Park, Ill., persuaded its preferred stockholders to convert to common shares, in a critical step of its continuing battle for recapitalization.

Observers say companies perceived as potential winners in the lotto for failed banks will be the most successful in finding fresh capital. Others could find raising capital tougher, regardless of their health.

At least half a dozen community banking companies that had sufficient capital, but sought more to fund growth, pulled public offerings late last year, citing poor market conditions. A few others settled for less than they set out to raise.

Several observers blamed timing, saying investor interest would surge along with new stock offerings after the release of fourth-quarter results.

Mark Fitzgibbon, the head of research at Sandler O'Neill & Partners LP, says share prices at a few companies traded up after they issued stock in January - a good sign for the market. "That normally doesn't happen," he says.

But others say smaller companies could be in for a market chill. In times of volatility, investors tend to go up the market-cap spectrum," says Laurie Hunsicker, an analyst at Stifel, Nicolaus & Co.

She expects investors to focus on companies with excess capital and pristine credit this year, dimming prospects for those with elevated nonperforming loans.

Hunsicker recommends that potential issuers discouraged by the pricing of an offering go through with it anyway. "On the buy side, there probably is only so much appetite for yet another turnaround story," she says. "The small companies that are in need of capital and that are frustrated about the discount should continue going forward, because I think there will come a time when the small companies - and I'm talking about the ones with credit issues - will be unable to access the capital markets."

Michael Iannaccone, the president of MDI Investments Inc., agrees. The expectation is that banks have another challenging year ahead, "so if the recovery is going to come in 2011, why invest now?" he says. "The bank might not be able to survive 2010."

Some wealthy investors have stepped in to lend money to select capital-strapped banks, though. lannaccone knows of one $200 million-asset bank that found no buyers for a $4 million convertible debt offering at 9 percent, so the bank decided to consider a single investor willing to do the deal for 11 percent.

He says regulators also are quietly coaxing healthy banks to raise capital, even though many are reluctant to do dilutive offerings. He says the hope is they will begin to pick off more strugglers and absorb failures. "When banks are examined, they're saying to those with high ratings, 'Can you help us out here? But you need to raise capital,'" he says. "I know that's what they're doing."

Even among the relatively healthy, community banks often have concentrations of commercial real estate loans that scare off investors, Kohler says.

But in cases where capital raises look unlikely or just unattractive, other plans are generally afoot. Few view it as an option to let their capital stand as is, amid such regulatory uncertainty.

Some are shrinking to boost their capital ratios. "The only show in town right now really is through shrinking the balance sheet or issuing common stock," says Peyton Green, an analyst at Sterne Agee & Leach Inc.

"I think clearly companies are trying to prepare for a more difficult regulatory environment where higher capital standards could come about."

Kohler says offers to exchange debt for equity also are "on the radar" a lot more since some have succeeded. "Debt is trading at such low levels, reflecting the concern of investors' not getting paid, so they're open to discussion," he says. "Depending on the terms of the exchange, that might be a risk they are willing to take. But generally it only works when banks are highly distressed."

Debt securities have no upside, so if the risk is not getting paid at all, investors are more willing to cash in for what amounts to a "lotto ticket" in the form of equity, Kohler says.

Just about everyone concedes that private equity is less of a force than expected.

"A lot of people thought private equity would come in and see bargains," Kohler says. "That has not happened to any great extent."

Most cite regulatory hurdles as the primary reason.

Iannaccone says many from outside the banking industry realized that finding a suitable investment, getting regulatory approval and reaching profitability would be too involved. "There is a considerable amount that has left the market," he says.

He also has seen some deals fall apart when the time comes to sign the letters of intent, after it becomes clear that the same investor had been negotiating with several different banks and only intended to put money into one.

7: AMERICAN BANKER - One Tough Sell

The new restrictions on overdraft fees set to go into effect July 1 are giving bankers headaches. Already stressed about the potential loss of fee income, bankers are trying to make sense of which transactions are covered by the rules, figure out what fixes they need to make in the back office and, most importantly, develop marketing campaigns that educate consumers about the rules without souring them on overdraft programs.

8: AMERICAN BANKER - OneWest Makes Money, But Making Friends is the Harder Part

In less than a year, the private-equity buyers of IndyMac Bank — the $32 billion-asset California thrift seized in July 2008 and run by regulators for six months — have turned a $1.6 billion profit.

Now called OneWest Bank, the company is outperforming rivals on various fronts, including working out troubled assets, and it should have plenty more opportunities: It has acquired two more failed banks in the past three months, and it's one of the few banks in the region with ample capital to do more deals.

Yet thriving on a mess that has already cost tens of thousands of IndyMac borrowers their homes is an awkward situation, and not just for the team of billionaire backers including George Soros, John Paulson and Christopher Flowers.

Shortly before OneWest's latest acquisition, the FDIC was forced to take the unusual step of publicly defending OneWest's loss-sharing agreement from a pair of video bloggers. For a bank with aspirations to become a sizable regional player, weathering the criticism may be as crucial as its ability to cobble together the assets of busted banks.

The franchise the Federal Deposit Insurance Corp. inherited featured terrible geography, reverse mortgages, securitized option adjustable-rate mortgages and the highest cost funding of any bank in the country. By paying off IndyMac's high-cost depositors, the FDIC immediately shrank the bank's deposits to $6.5 billion from $19 billion.

Under its new team, led by Chief Executive Terry Laughlin, the bank has made a limited return to lending. In the fourth quarter it originated about $1 billion of mortgages, selling half and keeping half on its balance sheet. It also built up its deposit base to more than $11 billion by yearend, filling the gap with Federal Home Loan bank advances.

But it's the terms of the FDIC deal that have yielded the bank's outsize earnings. OneWest paid $13.9 billion for IndyMac's assets — a 23% discount to their face value that more than covered OneWest's $2.5 billion "first loss" obligation. Should the amount ever be reached, and it hasn't yet, the FDIC would absorb first 80% and then 95% of further losses. In return, OneWest committed to modifying all of the IndyMac mortgages it serviced — so long as doing so would save investors money. According to the agency, none of the more than 80 potential buyers it solicited produced a better offer than OneWest's, which it estimated will cost the insurance fund more than $11 billion.

OneWest's accounting suggests that the bank believes that every penny of the losses its portfolio took this year was covered by the initial discount it got on IndyMac — it neither made provisions nor booked losses on the loans. What interest payments did roll off the portfolio were pure profit, amounting to $210 million in net income in the fourth quarter alone. On top of that, the bank earned $900 million in additional noninterest income. That total would presumably include gains in the net value of its servicing portfolio — — most servicers did well last quarter — but covering all of the difference would be a stretch, said Bert Ely of Ely & Co., suggesting that much of it may be the result of amortizing the gap between what OneWest paid and the actual value of the portfolio.

Even if the deal provided for a lot of easy money for the private-equity firm, OneWest's duties over the past year have hardly been a matter of sitting back and letting the checks roll in. It's also responsible for addressing the very cause of IndyMac's failure — a massive portfolio of terribly performing loans. Doing that has required administering the FDIC loan mod program that launched the Home Affordable Modification Program.

When the FDIC took over IndyMac, it created an ambitious effort to rehabilitate the mortgages the bank serviced, 60,000 of which were 60 or more days past due. Because securitized loans made up 90% of IndyMac's servicing portfolio, John Bovenzi, the former FDIC deputy chairman who was IndyMac's CEO during receivership, said that for most borrowers a straight principal writedown was out of the question. What the bank could do, however, was permanently drop interest rates, lowering total payments over the life of the mortgage.

Investors who owned the mortgages were initially worried that the FDIC would seek to lower payments indiscriminately. But Bovenzi said none ultimately protested after they understood that mods would only occur when they could be expected to save all parties money.

"If foreclosure made more economic sense, we weren't going to do the loan modification," he said, and this rule still applies to OneWest's current modifications done under Hamp. "When we're managing the receivership, we still have that statutory obligation to maximize value for the creditors of the failed bank," Bovenzi said.

IndyMac worked through a backlog of best candidates for mods first, Bovenzi said — the minority whose loans had solid documentation. And even getting those through the program required significant effort.

"We used Federal Express instead of regular mail because people actually open Federal Express," he recalled. When the pool of the most eligible borrowers was exhausted after a few months, the FDIC started offering conditional modifications. All together, out of 46,500 loans deemed eligible at the time of IndyMac's sale to OneWest, the FDIC had completed 8,512 mods and mailed out more than 32,000 offers. But in that same period it initiated almost 28,000 foreclosures in California alone.

Since the handoff from the FDIC, OneWest has frequently come under suspicion of "systemically working to push home loan borrowers into foreclosure," as The Sacramento Beereported this week in describing a string of local consumer lawsuits. Indeed, OneWest's and the FDIC's IndyMac agreement has drawn howls for producing too much profit and too few loan mods. Yet while it's true that the bank's mod program was slow to yield results — the bank barely managed 1,000 permanent modifications in the first six months it was in charge — its statistics have recently jumped, with the bank modifying 3,087 and making official offers to modify 5,048 more. And though Internet critics and others have frequently said that OneWest has been eager to foreclose on homes in order to trigger its loss-sharing agreement with the FDIC, to date the opposite appears to be true.

Foreclosure Radar data for IndyMac's home market of California shows that the number of foreclosure proceedings initiated on loans OneWest services has been cut in half since the bank took over from the FDIC — a decline that far exceeds the general slowdown in foreclosures in the state. OneWest's notices of trustee sales, which immediately precede the seizure of a home, have similarly dropped.

"They are not foreclosing at a pace that makes them stand out," said Sean O'Toole, Foreclosure Radar's founder.

And while a theoretical case could be made that it would be profitable for OneWest to foreclose rapidly in order to trigger its FDIC loss-sharing agreement, the bank is contractually obligated to the FDIC not to do so. Moreover, said Michael Krimminger, FDIC special adviser for policy, "the incentives are designed to get more loans past the net present value test" required to qualify for a modification. The FDIC is monitoring OneWest's performance.

Foreclosure Radar's data shows that OneWest appears to be far better at dealing with the process than far more established lenders in the state. In instances where third-party investors buy a property in foreclosure, they pay on average 10% more of the property's market value. And when OneWest takes properties back in trustee sales, it pays less to do so.

In California, O'Toole said, OneWest seems to run a far more organized operation. It is the only lender he is aware of, he said, that regularly announces its initial bid at trustee sales a week in advance, giving third-party investors the chance to do due diligence.

"By that simple act, they get much more aggressive bidding on their properties," O'Toole said.

Those results should benefit the FDIC whenever it does start paying out on its loss-sharing agreement with OneWest. (According to the agency, it still hasn't.) Yet given the bank's massive earnings this year, observers like Ely question whether the FDIC didn't overpay for the performance.

By comparison, the purchasers of BankUnited Corp., the only other FDIC private-equity deal similar in size to OneWest, have received a 25% return on equity in the seven months since taking control of the bank. The FDIC and OneWest declined to discuss the bank's performance.

9: AMERICAN BANKER - Prepaid Cards Eat into Banks' Territory

Prepaid card companies are making it possible to have the benefits of a bank account without actually having a bank account.

A growing number of prepaid companies are introducing features, such as online banking and bill pay, savings accounts and even lines of credit, that observers say are making card accounts seem more like basic checking accounts.

Executives say their products make it easier for the underbanked to stay away from banks and may even drive banks to expand their prepaid offerings.

However, analysts say banks will always have a marketing advantage, and adding advanced capabilities to prepaid cards might prompt some people to visit a branch, where these features — and more — are standard offerings.

Hamed Shahbazi, the chairman and chief executive of Tio Networks Corp., said many people who avoid banks still want access to modern financial services, and prepaid cards can meet those needs.

"The underbanked, from a financial perspective, aren't suffering from a digital divide," Shahbazi said in an interview Wednesday. "Those are two very different issues."

Tio, of Vancouver, said Wednesday that it would add its online bill-pay capabilities to prepaid payroll cards offered by First Data Corp.

The Houston processor FSV Payment Systems Inc. has also found there is demand among the underbanked for banking services, especially among users of its payroll cards.

Jonathan Palmer, FSV's president and CEO, said "it's not that they don't want a bank account or they don't want bank services … different people in this country regard banks differently — some don't trust banks."

"Our customers realize, as we make them aware, that they have access to a full array of financial services," Palmer said. This allows someone with a payroll card "to get into the mainstream of financial services."

FSV offers several prepaid products with features more commonly seen at banks, including online banking, bill pay, checks, savings accounts and lines of credit.

Aaron McPherson, a research manager for payments at IDC Financial Insights, said "the line is kind of blurring" between prepaid cards and conventional bank cards. Today's prepaid cards "should be seen as a variety of a debit card."

But while the features are similar, Palmer said prepaid cardholders differ from the average bank customer in the ways they use these financial services.

"Many don't use the savings account as you or I might," he said. Whereas banked consumers might have an emergency fund or save for long-term goals such as a home or retirement, the unbanked have more immediate savings needs.

"Many people at their socio-economic levels need to put money away for a special purpose," such as to pay the rent at the end of the month, he said. Without a savings account, these consumers use more cumbersome ways to hold on to their funds, such buying a money order and stashing it away until the end of the month.

And the line of credit offered on some FSV cards is "a much more efficient and a much less expensive way to borrow small sums of money than … small loan companies, payday lenders," Palmer said. "What we're giving people is the ability to manage their finances."

Other prepaid card companies have been moving in the same direction.

Last year NetSpend Corp. announced online budgeting tools similar to what banks offer as personal financial management. Plastyc Inc.'s iBankUP card allows users to have checks issued from the balance on their prepaid cards.

Shahbazi said that prepaid card providers face many of the same challenges as banks, and that offering new features can help them retain customers.

With payroll cards, for example, "it's not like these employees are always going to remain with that employer," Shahbazi said, and leaving a job often means leaving behind the payroll card that came with it. "There's going to be a lot of churn with these cardholders … bill pay is a fantastic way to retain that customer."

Representatives of First Data, a Kohlberg Kravis Roberts & Co. unit, would not make executives available Wednesday.

Though many of these advanced-feature prepaid products are payroll cards, other prepaid products are being used in novel ways.

Discover Financial Services offers a prepaid card, Current, that was designed for parents to give to their teenagers but in some cases is being used to help manage other types of household spending, much like a small-business credit card.

"We have seen instances where parents have opted to give the Current Card to their nannies," a Discover spokeswoman said by e-mail. "Others have provided it to elderly parents who are in their care."

McPherson is one of them. "I use it for my son's nanny," he said. "She takes him out to do things and needs a source of money to do that. She had just been using our personal credit card, but I was a little uncomfortable with that," so McPherson switched to Current.

And just as prepaid cards are becoming more banklike, banks may have to become more like prepaid companies to reach this audience. "My expectation going forward is that more banks will employ prepaid technology to help them deliver a full range of financial services more efficiently than they can today," Palmer said.

McPherson said that while prepaid cards are becoming more useful, "a bank does have a real advantage" in winning customers.

Prepaid cards are typically sold online or at retail stores, but banks "have branches, they have sales channels," and can use them to meet customers' needs, he said.

10: AMERICAN BANKER - Regions Reshuffles Management Ahead of Hall Ascension

Regions Financial Corp. is reshuffling management just weeks before new CEO Grayson Hall is set to succeed C. Dowd Ritter.

Regions said that David Turner would become the chief financial officer in early April, replacing Irene Esteves, who is resigning to pursue other interests. Turner had been the head of internal audit.

The Birmingham, Ala., company also said that David Edmonds, the company’s head of human resources, would become the chief administrative officer. David Keenan, who has handled human resources tasks for several Regions operations, will succeed Edmonds.

Hall, who will succeed Ritter at the end of March, will also form an operating committee that will include geographic leadership and business-line executives.

11: AMERICAN BANKER - Variable Annuities Have Had Struggles, But Pru's Bullish

Variable annuities may be staging a comeback.

Bruce Ferris, the senior vice president of sales and distribution for Prudential Annuities, said he has heard all the objections from wholesalers and advisers: in essence, that the product is too expensive or too complicated.

But while assets under management for variable annuities have declined over the past two years, they "aren't going away," and the perception of them is beginning to improve, Ferris said.

"In the past 18 months, retirement savings have atrophied by 40%, and that is starting to change a lot of attitudes about these products," Ferris said in an interview last week. "People like the idea of a product with a guarantee."

Ferris said the success of Prudential Financial Inc.'s U.S. annuity business is evident. Last year the company's annuity sales rose 58.3%, to $16.3 billion, from a year earlier as fourth-quarter sales rose 71.4% year over year, to $4.8 billion.

"Variable annuities provide us with the ability to offer downside protection and upside market participation," he said. "We can put a floor under an investment. It is a unique value proposition to have. … The question is no longer if [variable annuities] are appropriate, but what percentage of assets should have this protection."

In the bank channel, Prudential Annuities has had substantial growth. Its bank sales of variable annuities increased 152% year over year, to $1.8 billion, as it added 15 more banks to its distribution list. In the third quarter Prudential ranked first in bank sales of variable annuities, according to VARDS, a unit of Morningstar. In 2002 it ranked 14th in bank sales.

"Bank clients look at CDs, fixed annuities and fixed income as safer havens than equity products," Ferris said. "But right now they are finding it difficult to generate yields in fixed income or [to find] products that offer attractive returns for their retirement income savings. This is generating more interest in variable annuities."

Prudential Annuities has nearly doubled its wholesalers in the bank channel in the past two years, to 26. "We want to continue to add selectively from here," Ferris said. "We are confident that we have the right resources and support for bank clients. … We have made a significant investment in the bank channel over the last four to five years, and we are really starting to reap the benefits of that investment in our sales results."

That doesn't mean the Newark, N.J., company plans to stop investing in bank sales of annuities. "We have sustainable momentum in the channel," Ferris said. "Look at our industry: banks represent 12% to 13% of total industry annuity sales. We are right in that wheelhouse. I expect to continue to grow our business and I am looking at doing that across all channels."

Some advisers remain skeptical of variable annuities. Fixed annuity sales heavily outweighed variable annuity sales last year as many banking companies shied away from variable products because the guarantees associated with these products became too expensive, according to Michael White of Michael White Associates.

The strain that the market crash put on guaranteed-income rider providers is behind much of the change. Many providers have eliminated guarantees or raised their prices.

Figures from Kehrer-Limra showed that variable annuity sales rose 17% in the second quarter compared with the first quarter, versus a 55.9% gain for mutual funds. The disparity is striking, because sales of the two products usually move in tandem.

In fact, 2008 net sales of variable annuities were $23.8 billion, roughly half the 1999 total.

In the fourth quarter variable annuity sales rose 3%, to $32.6 billion, from the previous quarter, according to Limra's U.S. Individual Annuities quarterly sales survey.

"The last time VA sales were at this level was in 2003, at the end of the last financial crisis," Limra research director Joe Montminy said. "While we are seeing VAs slowly recover, the recovery is slower than expected."

Ferris said Prudential certainly has not won every adviser over. "There are still naysayers, and there always will be," he said. "But we attracted 20,000 new producers last year that are now offering Prudential annuities that never sold our products before. That is twofold our previous record of new producers. I think this is evidence that advisers recognize that given recent market conditions, variable annuities are a solution that make sense for many clients."

Prudential is not alone. Sun Life Financial Distributors Inc., the U.S. division of Sun Life Financial Inc. of Toronto, is looking for ways to increase sales of the product through banks. This month it hired Leslie Hunnicutt as a senior vice president and a national sales manager to increase sales through banks.

The Wellesley, Mass., unit vaulted into the top 10 providers of annuities through banks last year, Hunnicutt said. Its variable annuity sales rose 22% in the channel last year, and it expects a further increase this year, she said.

Sun Life has 19 wholesalers in the bank channel, up from 15 a year earlier, and it plans to add one wholesaler this year as part of its effort to become a "top five player overall," Hunnicutt said.

12: ANNOUNCEMENTS - Bank of America Merrill Lynch and IdenTrust to Collaborate...

...on Electronic Bank Account Management for Corporate Customers

New eBAM System for CashPro® Online Expected to Reduce Costs and Boost Efficiency by Allowing Clients to Open Accounts Online

Bank of America Merrill Lynch and IdenTrust today announced plans to bring an electronic bank account management (eBAM) system to the bank's corporate clients, enabling them to open accounts, close accounts and modify bank mandates online.

Bank of America Merrill Lynch envisions using the Trust Prime eBAM system from IdenTrust and expects to join the IdenTrust Trust Network, allowing the bank to issue interoperable digital identities that can be used around the world. Through these services, the bank account management process for clients can be fully electronic, which is expected to reduce end-to-end processing and support costs.

"Managing bank accounts can be a cumbersome, paper-intensive and time-consuming process," said Cindy Murray, Global Corporate Banking eCommerce executive at Bank of America Merrill Lynch. "These new capabilities have the goal of providing transparency and simplified workflow while allowing our customers to make changes to their accounts in an accelerated fashion. Our plans with IdenTrust and anticipated launch of eBAM are another example of Bank of America Merrill Lynch's ongoing investment in innovation and commitment to global expansion."

Karen Wendel, CEO of IdenTrust, said, "We are delighted to have the opportunity to help Bank of America Merrill Lynch deliver these new capabilities." Wendel added, "The IdenTrust framework is global in nature, and we believe it aligns perfectly with the Bank of America Merrill Lynch global model. Working with IdenTrust, banks can issue a single digital identity to a customer that can be used with any Web-based application, across any network in more than 170 countries around the world. The digital identities are fully interoperable with other banks that are members of the IdenTrust network. We anticipate a close relationship with Bank of America Merrill Lynch as it launches its eBAM service."

13: ANNOUNCEMENTS - Bank of Tokyo-Mitsubishi UFJ and Union Bank to...

...Jointly Market Power and Utility Lending in the U.S.

Customers to Benefit from Greater Lending Power  

The Bank of Tokyo-Mitsubishi UFJ (BTMU) and Union Bank today announced the introduction of an alliance between their existing power and utility groups in the United States. Beginning immediately, the groups jointly will market BTMU and Union Bank products under the Mitsubishi UFJ Financial Group (MUFG) brand.

The two U.S. power and utilities groups will report to the newly established Power & Utilities Leadership Team, led by Grant Ahearn, Head of Specialized Financial Services, from Union Bank and including Jonathan Lindenberg, Head of Project Finance for the Americas, from BTMU and John Edmonston, Head of the Power and Utilities Group, from Union Bank.  

"We are very excited about this new direction and the combined expertise it will bring to all of our clients in the United States," Ahearn said.  "Both BTMU and Union Bank have extensive experience in structuring complex financings for power and utility clients.  Customers will also benefit from the greater lending power of this alliance."

Lindenberg added "We believe our power and utilities clients utilizing project finance will benefit from the greater market knowledge that the MUFG team will have."

"Our intention is to further familiarize the market with the "MUFG" brand.  We expect that the unified efforts of BTMU and Union Bank will position us to achieve stronger results," Edmonston said.  

Ahearn added that "moving forward, our combined expertise in facilitating transactions, our solid reputation in the energy industry, and our ability to underwrite and syndicate large transactions should serve our customers very well. We will continue to consider how we can further work together to maximize our client services."  

14: ANNOUNCEMENTS - Bottomline Technologies Expands PayMode® Payment Network

Bottomline Acquires Bank of America’s Travel Commission Payments Service

Bottomline Technologies today announced it is expanding its payment network by acquiring the travel commission payments service of Bank of America. Bottomline will serve these travel clients through PayMode®, the market-leading electronic network for payment and invoice automation that Bottomline acquired from Bank of America last year.

More than two dozen major travel and hospitality companies and tens of thousands of travel agents around the world use the Bank of America travel commission payments service for commission payments, remittance and reporting. These clients will upgrade to PayMode, the world’s fastest-growing business-to-business payment network, later this year.  

This acquisition builds on the strategic work Bank of America and Bottomline have forged to leverage the strengths and technologies of each. Under the agreement, Bank of America will continue to provide commission service to clients until their transition to PayMode. Clients will receive the same levels of customer service and functionality they’re accustomed to, as well as gaining robust remittance reporting, enhanced delivery capabilities, and the ability to pay other suppliers within PayMode’s network of more than 90,000 members.

“We believe these travel and hospitality industry companies and the agents that book for them will be pleased with the commission payments services Bottomline Technologies will provide them,” said Bob Johnston, senior vice president and product management executive at Bank of America. “Working with Bottomline over the years as a provider of technology to the bank has given us confidence in its ability to deliver solutions that add value for clients.”

“We look forward to welcoming these new clients to Bottomline and are fully committed to their success,” said Rob Eberle, chief executive officer at Bottomline Technologies. “The acquisition of this travel commission payments service provides a natural extension of our Paymode platform’s capabilities and is another important milestone in our long relationship with Bank of America.”

15: ANNOUNCEMENTS - New Online Savings Goal Tracker Helps Consumers...

... Plan and Progress toward Savings Goals

Regions Brings Consumer Savings to Forefront During America Saves Week

BIRMINGHAM, Ala.--(BUSINESS WIRE)--This week, Regions Bank (NYSE:RF) launched a new tool to help consumers plan and save toward specific savings goals – a Savings Goal Tracker found on www.savewithregions.com. With this new tool, consumers can track their savings by goal – like a car, the holidays or for any major purchase. The Savings Goal Tracker creates a savings plan for the user and allows them to track their savings progress conveniently online.

After years of falling U.S. savings rates, many consumers are discovering the importance of saving. During the week of February 21, Regions has joined forces with members of the Financial Service Roundtable and the Consumer Federation of America in supporting America Saves Week – a time set aside to help consumers focus on the importance of saving.

In addition to the Savings Goal Tracker, www.savewithregions.com also includes an online savings review and tips on how to save time, money and for the future.

In advance of America Saves Week, the Consumer Federation of America and the Financial Services Roundtable released survey information about savings habits and banks’ efforts to help people save. Regions LifeGreen Checking and Savings bundle, in which customer can receive a savings bonus for automatic, monthly savings, was highlighted both as a best practice and as a product that is helping more people save.

More information on savings and Regions LifeGreen Checking and Savings account can be found on www.regions.com or by visiting any Regions branch.

16: ANNOUNCEMENTS - Wells Fargo Launches Updated Retirement Site

with Interactive Planning Tools at WellsFargo.com

New Decision Tools Available to Customers, Non-Customers

CHARLOTTE, N.C.--(BUSINESS WIRE)--Wells Fargo & Company (NYSE:WFC) today announced that the company’s online Retirement site has been enhanced to help people plan for this important time in life. New interactive tools on the site can help savers select the IRA best suited to their needs and calculate the cost of taking cash from a 401(k) account left at a previous employer. A new, age-based organization of the site allows users to focus on information relevant to their life stage – whether they are in their 20s or retired.

LINK TO FULL ARTICLE: http://www.marketwatch.com/story/wells-fargo-launches-updated-retirement-site-with-interactive-planning-tools-at-wellsfargocom-2010-02-25

17: BANKINSURANCE.COM - BBVA Compass Advances in Sunbelt with Guaranty Conversion

NEWS IN BRIEF - FEBRUARY 22 - 28, 2010

Birmingham, AL-based, $64.6 billion-asset BBVA Compass Bank has completed its conversion and rebranding of former Guaranty Bank branches in California and Texas into BBVA Compass.  BBVA Compass Chairman Jose Maria Garcia Meyer said, “The seamless conversion of Guaranty further advances BBVA’s well-defined strategy of growth and development of its U.S. franchise in the attractive Sunbelt Region.”  BBVA Compass entered into a loss-sharing agreement with the Federal Deposit Insurance Corporation (FDIC) in August 2009 to acquire Austin, TX-based, $13.5 billion-asset Guaranty Bank’s $11.5 billion in deposits, $12 billion of its assets and assume 20% to 5% of its losses.  BBVA Compass is a subsidiary of Birmingham, AL-based Compass Bancshares, a unit of Bilbao, Spain-based, $785 billion-asset BBVA Group.

BankInsurance.com News in Brief' is provided each Thursday courtesy of Michael White Associates @ www.BankInsurance.com.

18: BANKINSURANCE.COM - Dow Jones & CME Form Global Financial Joint Venture

NEWS IN BRIEF - FEBRUARY 15 - 21, 2010

New York City-based Dow Jones & Company and Chicago-based CME Group have agreed to form a global financial index services joint venture.  Dow Jones will license its name to the business and contribute its Dow Jones Indexes valued at $675 million.  CME Group will contribute its market data services valued at $607.5 million.  The joint venture will then raise $613 million in order to pay Dow Jones $607.5 million, giving CME Group 90% ownership of the venture and Dow Jones 10%.  Dow Jones CEO Les Hinton said, “A venture with CME Group provides advantages the index business needs to grow and prosper.”

BankInsurance.com News in Brief' is provided each Thursday courtesy of Michael White Associates @ www.BankInsurance.com.

19: BANKINSURANCE.COM - Retirement Age Workers Good Bets for Annuities

NEWS IN BRIEF - FEBRUARY 22 - 28, 2010

A record 55% of Americans plan to work past age 67, and the number who plan to work fulltime at that age has climbed to a new high of over 28%, according to the Unretirement Index based on a survey conducted by Wellesley, MA-based Sun Life Financial, U.S.   Sun Life Financial Distributors President Terry Mullen said, ”Americans need help building their savings for a more secure environment, and annuities with their guaranteed life income can help.”

BankInsurance.com News in Brief' is provided each Thursday courtesy of Michael White Associates @ www.BankInsurance.com.

20: BANKINSURANCE.COM - U.S. Bank Executives Reject Government as Wage Czar

NEWS IN BRIEF - FEBRUARY 22 - 28, 2010

Close to all (96%) of U.S. bank executives do not believe the government should play a role in setting bank compensation parameters and guidelines, and 61% do not believe such compensation parameters and guidelines will reduce excessive risk-taking, according to Grant Thornton’s 17th Bank Executive Survey sponsored by Bank Director magazine.  Executive pay should be based upon bank performance, 84% of bankers believe, and 58% believe increased government involvement will negatively affect their ability to successfully retain and recruit good executive management.  The vast majority (71%) of bankers in the Southeast agree with that last statement, followed by bankers in the Central Region (63%), the West (62%), the Midwest (55%) and last of all the Northeast (46%), Chicago-based Grant Thornton.

BankInsurance.com News in Brief' is provided each Thursday courtesy of Michael White Associates @ www.BankInsurance.com.

21: BANKINSURANCE.COM - U.S. Fixed Annuity Sales Trend Down

NEWS IN BRIEF - FEBRUARY 22 - 28, 2010

U.S. fixed annuity sales in the fourth quarter continued their quarter-to-quarter downward trend.  While first quarter sales of $34.8 million rose 2.1% over fourth quarter 2008 sales of $34.1 million, second quarter 2009 dropped 20% from first quarter sales of $27.8 million; third quarter sales dropped another 20% from second quarter sales to $22.1 million, and fourth quarter sales declined 9% to $20.4 million from third quarter sales.  Overall, year 2009 fixed annuity sales totaled $105.1 billion, down 1.5% from record earnings of $106.7 billion in 2008, according to data compiled by Evanston, IL-based Beacon Research for Washington, DC-based Insured Retirement Institute (IRI).  Book value annuities made up 44.2% of the fixed annuity market in the fourth quarter followed by indexed annuities (37.3%), and trailed by immediate annuities (9.4%) and market value adjusted (MVA) annuities (9.1%).  For the year 2009, book annuities accounted for almost half (49.5%) of all fixed annuity sales, followed by indexed annuities (30.2%), MVAs (14.9%) and fixed income annuities (7.6%), Beacon Research shows.

BankInsurance.com News in Brief' is provided each Thursday courtesy of Michael White Associates @ www.BankInsurance.com.

22: BANKINSURANCE.COM - U.S. Indexed Annuity Sales Hit Record $30.2 Billion in 2007

Indexed Life Sales Choppy

NEWS IN BRIEF - FEBRUARY 22 - 28, 2010

U.S. indexed annuity sales in 2009 reached a record $30.2 billion, exceeding the past record of $27.2 billion set in 2007 by 10%, according to AnnuitySpecs.com Indexed Sales and Market Report.  Record sales in the second and third quarters drove the results, which were slowed by fourth quarter sales of $7 billion, down 6.7% from $7,5 billion in third quarter 2009 and off 2.7% from $7.2 billion in fourth quarter 2008.  Jackson National Life was the number one provider of indexed annuities in the bank and wirehouse market, but Allianz Life was the top provider overall, followed by American Equity, Jackson National and ING, respectively.
     Indexed life insurance sales of $151.3 million in the fourth quarter slipped 4% compared to fourth quarter 2008 sales of $157.6 million, but were up 16% compared to third quarter 2009 sales of $127.1 million.  Aviva, with a 22% market share, was the top indexed life insurance provider.  Pacific Life, with the number 1 indexed life product, ranked second, followed by National Life Group, Minnesota Life, and American General Companies.  Among all indexed life insurance products sold, the average premium paid totaled $7,596, Pleasant Hill, IA-based AnnuitySpecs.com research shows.

BankInsurance.com News in Brief' is provided each Thursday courtesy of Michael White Associates @ www.BankInsurance.com.

23: BANKINSURANCE.COM - U.S. Individual Life Applications Continue Up

NEWS IN BRIEF - FEBRUARY 15 - 21, 2010

U.S. applications for individually underwritten life insurance in January rose for the sixth consecutive month year-over-year, increasing 1.2% over January 2009, according to the MIB Life Index.  Applications among individuals aged 60 and older achieved their 10th consecutive month of double-digit year-over-year growth, climbing 15.2% over January 2009.  Applications among individuals aged 45-59 continued a seven month year-over-year trend up, rising 2.5% over January 2009, but applications among individuals aged 0-44 were down 2.5% year-over-year, according to Braintree, MA-based MIB Group.

BankInsurance.com News in Brief' is provided each Thursday courtesy of Michael White Associates @ www.BankInsurance.com.

24: K@W - Banking Reform Proposals: Why They Miss the Mark

Big banks have been widely blamed for creating the global financial crisis, and last month the Obama administration proposed several reforms aimed at restricting their activities. Among them is the so-called Volcker Rule -- named after former Fed chairman Paul Volcker -- which prohibits banks from trading for themselves. But will these proposals lead to a healthier banking system and help prevent future crises? Several Wharton professors say that while the proposals have some good aspects, overall they miss the big picture.

LINK TO FULL ARTICLE: http://knowledge.wharton.upenn.edu/article/2434.cfm 

Reproduced with permission from Knowledge@Wharton (http://knowledge.wharton.upenn.edu), the online research and business analysis journal of the Wharton School of the University of Pennsylvania. All materials copyright of the Wharton School of the University of Pennsylvania. http://knowledge.wharton.upenn.edu 

25: K@W - Executive Compensation: More Regulation, or Just More Transparency?

The question of whether CEOs of America's major companies are overpaid has been a subject of interest for many years. Are the compensation practices for these elite men and women fair and appropriate? Do they provide proper incentives, or do they reward excessive caution or risk taking? Wharton accounting professors John Core and Wayne Guay have just completed a study on this topic. Guay, along with colleague Chris Armstrong, sat down with Knowledge@Wharton to discuss executive compensation and the controversies that it continues to generate.

LINK TO FULL ARTICLE: http://knowledge.wharton.upenn.edu/article/2431.cfm

Reproduced with permission from Knowledge@Wharton (http://knowledge.wharton.upenn.edu), the online research and business analysis journal of the Wharton School of the University of Pennsylvania. All materials copyright of the Wharton School of the University of Pennsylvania. http://knowledge.wharton.upenn.edu 

26: M&A - BNY Mellon to Acquire Corporate Trust Business of CIBC Mellon

Deal greatly expands company's leadership position and presence in Canada

BNY Mellon, the global leader in asset management and securities servicing, has signed a definitive agreement to acquire the corporate trust business of CIBC Mellon.  The acquisition will more than double BNY Mellon's share of the corporate trust market in Canada and expand its leadership position in a number of key segments, servicing domestic and cross-border debt issuances, structured credit and securitizations, government stimulus programs and public private partnership transactions.

The acquisition is expected to close by the end of the first quarter, subject to regulatory approvals.  Terms of the agreement were not disclosed.

"This transaction enhances our leadership position and presence in Canada and demonstrates our strong commitment to growing our corporate trust business globally," said Scott Posner, chief executive officer of BNY Mellon Corporate Trust. "Our focus will be on continuing to provide the high quality service that clients have come to expect from CIBC Mellon while offering them a broader set of services that meet their growing and evolving needs."  

"This transaction is a win-win for everyone involved," said Thomas S. Monahan, president and chief executive officer of CIBC Mellon.  "Our corporate trust clients will be able to access the global capabilities of the world's largest corporate trust provider, BNY Mellon, and CIBC Mellon will be able to further focus on providing market leading products and services across its core client base. As always, high quality client service will remain our priority up to and following the close of this deal."  

Upon completion of the deal, BNY Mellon, through its wholly-owned subsidiary BNY Trust Company of Canada, will service approximately $300 billion in outstanding debt with offices in Vancouver, Calgary, Toronto and Montreal.  In addition, it will offer clients a range of new services, such as cross-border issuer services, administration outsourcing, portfolio analytics and document custody.  

"Canada is a thriving country with a strong banking system, stable economy and compelling growth opportunities in many industries, such as oil and gas, mining, financial services and technology.  We are well-positioned to be the provider of choice across nearly every client segment in Canada," said Posner.

BNY Mellon Corporate Trust services $12 trillion in outstanding debt from 58 locations in 20 countries. Its clients include governments and their agencies, multinational corporations, financial institutions and other entities that access the global debt capital markets. The corporate trust business utilizes its global footprint and expertise to deliver a full range of issuer and related investor services and develop customized and market-driven solutions. Its range of core services includes debt trustee, paying agency, escrow and other fiduciary offerings.

27: MISCELLANEOUS - BofA Sues Spire Developer over Credit Card Debt

Bank of America is suing Chicago Spire developer Garrett Kelleher for $110,000 in unpaid credit card bills associated with the stalled construction project.
 
Kelleher personally guaranteed two credit cards issued by the bank in 2006 and 2007 as it provided initial funding for the splashy project, a cork-screw-shaped building designed by Spanish architect Santiago Calatrava, according to a Feb. 17 filing with a U.S. District Court in Chicago.

28: MISCELLANEOUS - U.S. Bank Moving 1,600 jobs from St. Paul to Richfield

St. Paul's office market, already the weakest in the Twin Cities, suffered another serious setback Thursday when U.S. Bancorp announced it would move 1,600 employees early next year to Richfield.

The move, which will nearly empty a 325,000-square-foot building on Shepard Road along the Mississippi River, represents more than one-third of the bank's workforce in St. Paul. 

The Minneapolis-based bank has leased about 340,000 square feet at Meridian Crossings, an office complex near the intersection of Interstates 494 and 35W.

U.S. Bancorp spokesman Steve Dale said the flexibility to expand at the Richfield location played a part in the decision to move. The facilities will house a variety of operations, including technology, product management, human resources and credit and risk management, he said. He declined to say whether the bank would be hiring, but said the new office will give it the ability to grow.

The news was a coup for Richfield, where officials said they knew their city was in the running for the bank's relocation but didn't know for sure it was coming until it was announced. 

"I'm absolutely elated," Richfield City Manager Steve Devich said. "With all the glum economic news, having 1,600 new jobs located in Richfield is a huge boost for us." He said the bank will be the city's second-largest employer, behind Best Buy Co. Inc., whose corporate campus is across 35W from Meridian Crossings.

It's a much different story for St. Paul and JLT Group Inc., the owner of the Shepard Road building that U.S. Bancorp has occupied for about 12 years. 

29: PERSONNEL CHANGES - Bank of America Merrill Lynch Names...

...Sam Chapin and Todd Kaplan Executive Vice Chairmen of Global Banking

Bank of America Merrill Lynch Global Banking and Markets President Tom Montag today announced that Sam Chapin and Todd Kaplan have been appointed executive vice chairmen of Global Banking, effective immediately. In these roles, Chapin and Kaplan will report to Montag and focus on deepening strategic client relationships and delivering the company's vast global resources on their behalf. Chapin will be based in New York, and Kaplan will be based in Chicago.

"Sam and Todd are among the most widely respected investment bankers in the industry," said Montag. "Their decisions to rejoin Bank of America Merrill Lynch are a reflection of the tremendous momentum we have achieved as a combined company and global industry leader."

Chapin, a 26-year Merrill Lynch veteran, served as a vice chairman and member of the executive client coverage group from 2003 to 2009, responsible for developing and coordinating senior corporate client relationships around the world. Prior to that, he was head of global investment banking from 2001 to 2003. He joined Merrill Lynch in 1984 as a member of the mergers and acquisitions group and was named a managing director in investment banking in 1993 and a senior vice president of the firm in 2001.

"Bank of America Merrill Lynch has a tremendous range of global resources that clients need and value," said Chapin. "With our strong momentum, we are well positioned to continue deepening and growing our client relationships. It will be a pleasure to return to the firm and to work with so many talented bankers around the world."

Kaplan was most recently the head of investment banking at Citadel Investment Group since March 2009. Prior to Citadel, he was a 22-year Merrill Lynch veteran and was head of the global principal investments division when he left the company. Between 2006 and 2008, he was chairman of global leveraged finance and a member of the global origination executive committee. He held a number of senior roles within investment banking, including head of leveraged finance, head of corporate finance, head of capital markets and financing, and chief operating officer of the global markets and investment banking group. He joined Merrill Lynch in 1986, and was appointed senior vice president in 2002.

30: PERSONNEL CHANGES - Citi Board Nominates Ernesto Zedillo to Board of Directors

Citi's Board of Directors today announced that it has nominated Ernesto Zedillo as a new non-management director candidate to stand for election at Citi's annual shareholder meeting on April 20, 2010. Dr. Zedillo was the President of Mexico from 1994 to 2000 and is now Director of the Yale Center for the Study of Globalization.

"We are pleased to nominate Dr. Zedillo to join the Board of Directors. Dr. Zedillo's extensive experience as a world leader and his expertise in global economics make him a valuable addition to the Board," said Richard Parsons, Chairman of the Board. "He will be a great steward for Citi as it continues to grow internationally and build on its unmatched global strengths."

As previously announced, John M. Deutch will not be standing for election at the April annual shareholder meeting. In addition, C. Michael Armstrong and Anne M. Mulcahy have indicated their intention not to stand for election at the annual shareholder meeting in April.

"On behalf of the Board of Directors, we would like to thank Dr. Deutch, Mr. Armstrong and Mrs. Mulcahy for their years of dedicated service to the Board. Each of these distinguished directors has made significant contributions to the Company and provided invaluable guidance and counsel during their tenure. All three of these directors were diligent and rigorous in terms of carrying out the Board's oversight responsibilities. They will be missed." Mr. Parsons added.

Ernesto Zedillo

31: PRODUCTS - U.S. Bank Launches Two New Products...

...to Help Companies Streamline Cash Handling Needs

U.S. Bank has launched an enhanced cash vault service called Advanced Cash Credit and Notification solutions. The new solutions include Remote Cash Deposit and the DTS(R) Tracking System. Both services help companies streamline their cash handling needs, provide additional information regarding their deposits, reduce cost and mitigate risk.

Remote Cash Deposit allows customers to electronically deposit cash, consolidate depository banking relationships, reduce armored car pickup frequency, and increase security. U.S. Bank has partnered with Brink's Inc. to use their CompuSafe(R) product line. Business customers deposit currency into a Brink's CompuSafe and electronically receive collected credit to their U.S. Bank depository account the following business day.  

With the DTS Tracking System, businesses can monitor deposits from the time of preparation at the store location until they are processed and credited at the bank. This allows retailers to manage their overall deposit process from a central location. It makes it possible to identify early on if a store's deposit is missing, late or has a discrepancy that needs quick resolution.

"Remote Cash Deposit is designed to mitigate the risk of fraud and reduce labor expense associated with cash handling, while also increasing staff safety and productivity," said Bill Burback, vice president in global treasury management at U.S. Bank. "And with the DTS Tracking System, retailers can have improved and early access to detailed deposit information that allows the corporate office to adjust individual store processes and procedures for quicker and more efficient deposit processing. The cash vault's Advanced Cash Credit & Notification enhancements give our business customers a powerful way to better manage their cash handling needs."

32: REGULATORY - National Bank Regulator Lets Unsafe Practices Flourish

Are banks the new face of payday lending?

A key federal regulator for years has let national banks engage in lending practices that the regulator itself admits harm consumers and lenders, according to two new reports from the Center for Responsible Lending. 

The reports focus on two of many areas in which the regulator—the Office of the Comptroller of the Currency, or OCC—has fallen down on the job: payday lending and checking account overdraft charges. The OCC's regulatory lapses documented in the reports include the following:

• Allowing nationally chartered banks to evade state law and offer high-interest payday loans directly to consumers. Years ago, the OCC cracked down on bank partnerships with payday lenders, citing concerns about "safety and soundness, compliance, consumer protection, and other risks to banks." Yet the OCC allows the banks it oversees to make the same type of loans directly.
• Allowing national banks to market payday loans to account holders as a way to return accounts to good standing after overdraft charges are assessed, thus encouraging repayment of one high-cost debt with another.
• Allowing banks to unfairly increase overdrafts charges—which have shot up 35 percent in just two years and now cost Americans $24 billion per year—even though the OCC determined that these practices were a problem for consumers as early as 2001.
• Failing to investigate whether banks' payday loans and abusive overdraft programs violate anti-discrimination and fair lending laws.

Several civil rights leaders agree that the status quo cannot continue:

"These reports reveal the inadequacy in our current system of oversight," said Gary Flowers of the Black Leadership Forum. "Unfair overdrafts and bank payday loans strip working people of their hard-earned funds. Given the state of our economy, one would think we could expect some real reform now. Instead, we see a national bank regulator stepping back and letting more unjust practices spread through the banking system."

"The continued predatory targeting of African Americans and other racial and ethnic minorities by unscrupulous financial institutions harms our initiatives to build wealth or simply retain financial stability," said Hilary Shelton, Director of the NAACP Washington Bureau and the Senior Vice President for Advocacy and Policy.  "As these reports show, the federal government hasn't been protecting all Americans from financial exploitation.  This is why Congress needs to create an entity as soon as possible dedicated to safeguarding all consumers."

"NCLR calls on the OCC to fully enforce its own guidance on payday loans and overdraft fees," said Janis Bowdler, Deputy Director of the Wealth-Building Policy Project at NCLR. "High bank fees and abusive practices not only disproportionately affect communities of color, but they drive families away from mainstream banking system. Instead, OCC should be focused on how to connect the unbanked with sustainable bank products."

CRL predicts that unless the OCC and other bank regulators curb bank payday loans immediately, this unsafe product will likely spread throughout the banking industry as swiftly as overdraft abuses have.

33: REGULATORY - New Rights for Credit Cardholders

Consumer Action and American Express announce the update of their free, popular multilingual consumer education series, “Credit Cards: What You Need to Know”

Consumer Action in partnership with American Express announce a revised version of the multilingual consumer education series “Credit Cards: What You Need to Know” to help consumers understand their new credit card rights and what they mean for credit cardholders.

Through the new federal rules, cardholders have gained the right to restrict interest rates on balances. Consumers can now say no to future rate hikes and over-the-limit fees. These and other new federal consumer protections for cardholders take full effect today.

Starting today, consumers can find the “Credit Cards: What You Need to Know” brochure updated to reflect new federal rules at www.consumer-action.org or www.americanexpress.com/consumerresources. The complete module, including brochures available in Chinese, Spanish, Korean and Vietnamese, will be available over the next few months on Consumer Action's website.

“Credit Cards: What You Need to Know” has become a perennial favorite since we created the joint education campaign in 2005, alerting consumers to the ‘real deal' on credit card terms and conditions,” said Ken McEldowney of Consumer Action. “We have distributed more than 286,600 of our education and training modules to 1,538 community-based organizations in 50 states. In addition, close to 200,000 visitors have viewed the brochure in one of five languages on our website to learn how to compare credit card offers, read and understand credit card terms and conditions, and avoid penalties and fees.”

“As consumers are making choices about credit cards, they need to know their rights and have them presented in a clear and concise way,” said Ralph Andretta, executive vice president and general manager, Consumer Services group, American Express. “In addition to our redesigned credit card agreements and enhanced online consumer resource tools, we are pleased to continue our work with Consumer Action to educate consumers on making smart, informed choices about credit cards.”

Five important new rights for credit card holders

1. No changes in terms or rates in the first year of a new card, except:

• When a promotional rate ends
• If your variable rate adjusts
• If you pay more than 60 days late

2. No rate hikes on existing balances:

• Interest rate increases generally apply only to new transactions
• 45 days advance notice of any significant changes
• Right to decline the change, close card and pay off balance over time

3. More time to plan for and make payments:

• Same due date every month
• Bills sent 21 days in advance
• Payments received by 5 p.m. must be credited that day.

4. Control and choice on over-limit fees:

• Cardholder can control and avoid fees
• Over-limit fees cannot be charged unless customer “opts in”

5. New information on your bill:

• Length of time to pay off your current balance if you make only minimum payments.
• How to pay off your current balance in three years.
• What will happen if your payment is late

For the last five years, Consumer Action and American Express have held regional train–the-trainer meetings in seven cities and trained 337 representatives of more than 250 community-based organizations, using these comprehensive materials

34: REGULATORY - Traction for Banking Regulation

The prospect of a financial regulatory overhaul’s passing Congress brightened on Thursday, as representatives of the banking industry left a meeting with the Treasury secretary saying that they had agreed on the need to get a bill through Congress this year.

Members of the Senate Banking Committee, which has wrestled for months over the legislation, said they believed an accord might be possible, though significant differences remained over the extent of new consumer protections, among other matters.

Richard C. Shelby of Alabama, the senior Republican on the panel, said that he and the committee’s Democratic chairman, Christopher J. Dodd of Connecticut, who met on Wednesday evening, “agree on probably 90 percent” of “just about everything” in the legislation.

In a meeting on Thursday at the Treasury, the secretary, Timothy F. Geithner, warned officials from eight industry associations that failure to enact the overhaul would destabilize markets and hamper the ability of the United States to contribute to international discussions over regulatory modernization, according to several participants.

“He spent a lot of time listening, but he opened it by saying that they were going to push hard to really get this bill done and get it done in the near term,” said Edward L. Yingling, president of the American Bankers Association.

He added, “Everybody in the room from the private sector indicated that their wish would be to get a bill done this year — and that they were in fact working to that end.”

A major point of agreement is the need for a new entity to detect systemic risks and prevent them from damaging the financial system. There is widespread support for a council of regulators, led by the Treasury secretary, to oversee that task, but the extent of its powers, and the role of the Fed within that council, remain uncertain.

The greatest area of disagreement has been the proposal for a stand-alone agency to combat abusive and deceptive mortgages, credit cards, payday loans and other consumer products. Much of the banking industry has opposed the idea.

The Obama administration this week reiterated its support for an agency with the power to make and enforce rules, but left open the possibility that it could be housed within an existing body.

According to a person briefed on the negotiations, Mr. Dodd has agreed to give way on a freestanding agency but has fought to create a regulatory entity that would have an independent chairman and budget, and oversight over nonbank financial institutions, like payday lenders.

Elizabeth Warren, the Harvard Law professor who first proposed the agency, said in an interview on Wednesday that the agency should stand alone. “I keep looking for the word independence,” she said.

Opponents say the agency would interfere with “prudential supervision,” the duty of federal regulators to ensure the “safety and soundness” of banks.

Members of the Banking Committee said they were divided on the question.

Existing regulators should take on consumer protection, “and it should be raised to the same level of visibility and responsibility as safety and soundness,” said Senator Judd Gregg, Republican of New Hampshire.

Senator Sherrod Brown, Democrat of Ohio, said “the fundamental thing is that the language be strong enough,” and that if the agency does not stand alone, “we can still do it right, mostly.”

Another area in which the Obama administration has faced opposition is the so-called Volcker rule, a proposal to ban banks from owning hedge funds and private equity funds and from risking their own money making market bets — a practice known as proprietary trading.

Some officials have said that the objective of the proposal — named for Paul A. Volcker, a former Federal Reserve chairman — could be achieved under a provision in the House overhaul adopted in December. That provision would let regulators ban speculative trading by banks if it is deemed too risky.

A White House spokeswoman, Jennifer Psaki, said on Thursday that the administration was committed to the rule.

But the current Fed chairman, Ben S. Bernanke, expressed skepticism on Thursday about the feasibility of the proposal.

“If you go about imposing the Volcker rule, I think it would be difficult to do it on a purely legislative basis, because of the potential for having unintended consequences,” Mr. Bernanke told the banking committee at a hearing. “So while on the one hand, you may want to restrict purely proprietary trading, you want to distinguish that from appropriate hedging behavior.”

Banks that benefit from the government safety net can be prevented from taking excessive risks through several measures, including increased capital requirements, restrictions on executive pay and controls on risk, Mr. Bernanke said. He said that regulators arguably already had the authority to crack down on speculative trading, “but if Congress wanted to reinforce that, it couldn’t hurt.”

Mr. Bernanke has his own worries; several senators have called for stripping the Fed’s bank supervision powers as part of the regulatory overhaul.

The industry representatives who met with Mr. Geithner opposed that idea. “There was widespread agreement on the need to strengthen the Fed, not weaken it,” said Steve Bartlett, president of the Financial Services Roundtable.

Senators said that several areas remained under active discussion, among them whether to create a large exemption from new rules that would subject over-the-counter derivatives to more transparent trading and how to dissolve a large company before it became “too big to fail,” so that a government bailout was not needed.

35: MISCELLANEOUS - Adoption of Technology is Key Factor in Saving Your Life

and Your Money

Availity CEO Contributes Chapter to Paper Kills 2.0

JACKSONVILLE, Fla.--(BUSINESS WIRE)--According to Julie Klapstein, CEO of leading health information network Availity, LLC, “Technology adoption by health care providers will be a key determinant in the speed with which our nation’s health care system is transformed, and the speed at which patients and providers benefit from better clinical outcomes.”

“The adoption of technology is an accelerator that can and will transform health information technology, and by extension, affect lasting systemic change.”

Based on her company’s experience in the health information marketplace, Klapstein summarizes her chapter in the newly-released book Paper Kills, 2.0 by saying, “A solution that is not comfortable for health care-providers-as-technology-consumers will not be adopted widely. Only when providers are comfortable [with new technologies] will our health care system extract peak benefit from the time-saving, money-saving and even life-saving advancements delivered through information technology.”

Newt Gingrich, founder of the Center for Health Transformation and former Speaker of the U.S. House of Representatives, agrees. As co-author of the book’s foreword with former U.S. Senate Majority Leader Tom Daschle, and advocate for a 21st Century Intelligent Health System that saves lives and saves money, Gingrich says, “The adoption of technology is an accelerator that can and will transform health information technology, and by extension, affect lasting systemic change.”

Paper Kills 2.0 is the timely, powerful sequel to the award-winning book, Paper Kills. In it, Gingrich, Daschle, and other national leaders explore the leading information technologies that can and will transform the nation’s health system. With a specific look at the impact of the federal ARRA investment, Paper Kills 2.0 is a thought-provoking book that explores the most important drivers of health IT, from innovation, primary care, and clinical research to e-prescribing, electronic administration, and health information exchange.

According to Klapstein, “All of us have experienced the role of the Internet in transforming our lives by opening our access to information, beyond what we could have imagined just a few decades earlier. Similarly, I have seen hospitals and physicians’ offices transform and improve the way they manage their businesses by implementing comprehensive information systems, and embracing change where it begins—at the individual level. With the Internet as an enabler, these businesses are now connected to a broader stakeholder community and they’re improving communication of critical healthcare information, improving clinical outcomes for patients, and driving cost out of the system.” Klapstein adds that technology adoption is especially critical in assuring the success of collaborative efforts that span public and private sector solutions.

With praise from luminaries such as Dr. Mehmet Oz, Mike Leavitt, Bill Frist, and Jeff Immelt of GE, Paper Kills 2.0 is required reading for industry leaders, providers, and policymakers who want to understand what is happening today and what will likely happen tomorrow to bring healthcare into the 21st century.

36: MISCELLANEOUS - Community Banks Should Link ERPs to Long-Term Performance

Community banks may not be the focus of national controversies concerning executive bonuses, but they would be wise to review supplemental executive retirement plans (SERPs) to include performance goals based on long-term performance of their banks, say two Clark Consulting, LLC independent consultants.

“The Fed acknowledges that there is not a ‘one-size-fits-all’ solution”

“New federal rules will likely focus first on large banks, but they ultimately may apply to community banks as well,” said Independent Consultant Ken Derks in a whitepaper released today.

“The Fed acknowledges that there is not a ‘one-size-fits-all’ solution,” added Trey Deupree, also an Independent Consultant and co-author of the paper.

“Yet heightened scrutiny of incentive compensation plans means that bank management and boards of directors will be best-served by devoting more time and resources to actively monitoring risk-taking associated with incentive compensation plans and to avoid plans that encourage excessive risk-taking,” Mr. Deupree said.

In response to expected changes, some community banks already have begun to react by adopting performance-based SERPs, a form of non qualified benefit plan, according to Derks and Deupree. Using this method, a bank makes a contribution based on performance objectives to a deferred compensation account. Those contributions can be discretionary, formula-based or tied to various performance factors and can include various provisions such as vesting, early retirement benefits, change-in-control benefits and pre-retirement death benefits. 

To learn more about such programs, or receive a copy of the whitepaper, select and contact an Independent Consultant in your area using the list located at http://www.clarkconsulting.com/firm/people/directory.shtml. 

37: MISCELLANEOUS - New Financial Guide: Power Of Psychology In Building Wealth

The Secret to Money Mastery by Kent T. Stuver aims to empower readers with a blend of neuroscience and finance know-how

OREM, Utah (MMD Newswire) February 26, 2010 -- The Secret to Money Mastery: Leveraging the Law of Attraction in Your Personal Finances by Kent T. Stuver seeks to demonstrate how readers can re-program the non-conscious aspect of their brains to attract and create financial prosperity.

According to Stuver, the secret to money mastery lies in an individual's ability to utilize the "Law of Attraction," or focusing thoughts and energies on what you want in order to bring it into the reality of your life. Stuver argues that such focus, when combined with belief, conviction and emotion, results in a reorganization of the non-conscious mind and transformative change in behavior and aptitude. By combining conscious and unconscious efforts, Stuver contends that readers will achieve new levels of success in money management.

"The vast majority of books written on personal finance or personal money management focus on the conscious-brain activities and practices relating to spending, saving, budgeting and more," Stuver says. "Those are important, but insufficient. This book offers the necessary foundation around programming the non-conscious brain for financial prosperity then builds on that foundation with common sense money management principles and practices."

Intended to serve as an inclusive guide, the book is split into two sections: a discussion on the "Law of Attraction" and non-conscious brain activity as well as an in-depth primer on sound financial practices.

The Secret to Money Mastery: Leveraging the Law of Attraction in Your Personal Finances is available for sale online at Amazon.com and other channels.

38: CAST MANAGEMENT CONSULTANTS

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