BANKING ON FOR WAL MART…
This week the Federal Deposist Insurance Corporation closed the comment period on talks to decide if Wal Mart ought to be allowed to operate it’s own industrial bank. In a 52-page document, Wal Mart said such a move would present no unusual risks or problems.
Riiggghhhhttttt.
“We would like to reiterate that we are fully committed to meet all statutory factors necessary to obtain federal deposit insurance,” Jane J. Thompson, president of Wal-Mart Financial Services, wrote in the letter’s introduction. “In addition, as we have stated several times publicly in oral and written testimony, our business plan does not include branch banking and we fully expect to receive a condition stating such a restriction.”
I actually don’t object to Wal Mart’s desires in this case. Owning an industrial bank would allow Wal Mart to internalize the processing fee it now pays to other companies to handle its credit card reciepts. And if the company passed that saving along to the customers, that wouldn’t be a bad thing.
But granting the Bentonvile Behemoth that desire opens a door I think would be better left closed, locked, barricaded and perhaps even bricked over. It’s a door that would allow Wal-Mart to open branch banks in ever store. It would allow Wal Mart to become Mr. Potter times a gazzilion.
Yes, these would be the same branch banks Thompson told the FDIC that Wal Mart was even willing to accept a restriction on. And if we could take Wally World at its word, there’d be no problem.
But I just don’t trust them and the consequences of doing so would not be pleasant.
The FDIC has closed the official comment period, but that doesn’t mean we can’t all keep reminding them that we think this is a bad idea. There is a moratorium on any decision until January 2007. This is an important story to keep alive.
[...] BANKING ON FOR WAL MART… This week the Federal Deposist Insurance Corporation closed the comment period on talks to decide if Wal Mart ought to be allowed to operate it’s own industrial bank. In a 52-page document, Wal Mart said such a move would present no unusual risks or problems. Keep reading… [...]
[...] As with all cancers when one area for growth gets blocked (The Walmart banking initiative ) it just spreads elsewhere. [...]
[...] This Wednesday the Federal Deposit Insurance Corp. may decide the fate of Wal-Mart’s banking aspirations. This case is not just about Wal-Mart. Other commercial entitities want to own and operate their own banks. I think that’s a really bad idea. Remember Mr. Potter? [...]