Bank One Corp. has fixed a lingering problem with its retail branches that had frustrated customers trying to do business at offices out of state.
Just because the Bank One signs, advertising brochures and branch layouts look the same everywhere didn’t mean that the branches in different states were able to access each other’s customer accounts.
“We’ve taken care of that problem,” said Tom Kelly, Bank One spokesman.
Until recently, customers who have an account at a Bank One branch in southern Wisconsin or northwest Indiana couldn’t do something as simple as deposit a check with a teller at a Bank One branch in the Loop unless they had their account number with them.
Also affected were vacationers, especially snowbirds who head west in the winter.
“We only have about a half-dozen branches in Florida, but we’ve got about 150 in Arizona and quite a few in Texas,” Kelly said.
For several years, many customers got around the problem by using ATMs. For example, a Bank One ATM in northwest Indiana could take a deposit intended for an account at a bank in Illinois. But for transactions that needed a teller, customers’ options were limited.
The communication problem was a result of Bank One’s rapid growth, which was fueled by purchasing regional banks. It took time to work out the systems and technology that ensured those branches in different states could access every customer’s information, Kelly said.
Competition heats up: A new federal analysis confirms what’s been evident to anyone who has noticed the proliferation of National City, Washington Mutual and Fifth Third bank branches opening in the Chicago area, in addition to the expansion of Bank One, Harris Bank and others.
Retail banking competition in Chicago is intense and is increasing, according to the Federal Deposit Insurance Corp.’s winter outlook report. That could be good news for consumers, it concludes.
Those newcomers to the market will focus on building market share, “a strategy that can place competitive pressure on prices and services in a given market, as established institutions seek to retain customers,” according to the FDIC.
Cycle snares payday borrowers: The vast majority of payday lenders, which make short-term loans that often are sought to tide a borrower over to the next payday, make most of their money from people “trapped in a cycle of repeated transactions,” according to a study released Thursday.
In Illinois and Indiana, that results in an average 13 loans per borrower each year, the highest number found by analysts from the Center for Responsible Lending. Wisconsin was next, with an average of a dozen loans per borrower.
Many borrowers take out a loan to pay back the previous one, getting them into a cycle that can tack on a fee of about $45 each time this is done. On a relatively small loan of $300, that equates to an interest payment of about 15 percent.
But if the original loan is turned over every two weeks, and a $45 fee is tacked on each time, the interest rate over a year equates to more than 400 percent, analysts at the North Carolina-based center found.
Discussing the findings at a press briefing Thursday, Julian Bond, chairman of the NAACP, called predatory lending “legalized extortion” that is “threatening the livelihood of hardworking families and stripping equity from entire communities.”
Banks named top givers: Two banks with a large Chicago presence made Business Week magazine’s recent ranking of the nation’s most philanthropic companies. The two were among the top 10 most generous cash givers, the magazine said.
Fifth Third Bancorp earned fourth place on the list, for giving $26.5 million, or 0.42 percent of its revenue, in 2002. Northern Trust was ninth on the list, giving $9.6 million, or 0.34 percent of its revenue.
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