Wal-Mart Withdrawls Application For Wal-Mart Banking
From the Washington Post:
Wal-Mart Withdraws Application to Charter Wal-Mart Bank
On March 16, 2007, Wal-Mart announced its decision to withdraw it application for federal deposit insurance for an industrial loan company (ILC). An ILC is a special type of state bank that may be owned by commercial firms. The Chairman of the Federal Deposit Insurance Corporation, Sheila Bair, released a statement on the Wal-Mart decision, calling it "a wise choice" that would remove the controversy over the Wal-Mart ILC application.
In response to Wal-Mart's decision, NAR President Pat Vredevoogd Combs issued a statement hailing the decision as "a major victory for our country and our financial security." NAR has written, testified, and argued against approval of the Wal-Mart and other pending ILC applications from commercial firms, including Home Depot. Commercial firms should not be allowed to engage in banking, because of the inevitable conflicts of interest and risks to the financial system that result.
NAR will continue to work for enactment of H.R. 698, the "Industrial Bank Holding Company Act of 2007," introduced by Rep. Paul Gillmor (R-OH) and Financial Services Committee Chairman Barney Frank (D-MA). The bill would close the existing ILC loophole--the last major statutory exception to the national policy against mixing banking and commerce.
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