Wal-Mart to Seek FDIC OK on Bank Plans

BENTONVILLE, Ark. - Wal-Mart Stores Inc., ever looking for ways to expand its already huge empire, is asking the government for permission to move into an entirely different industry: running its own in-house bank.

The world's largest retailer will ask the Federal Deposit Insurance Corp. Monday for permission to open a bank that can process millions of checks and credit card payments each month. The company says it's not interested in running a consumer bank as well, but some of its opponents still fear such a step could hurt local banks much like the mom-and-pop stores were during Wal-Mart's rapid expansion.

http://news.yahoo.com/s/ap/20060407/ap_on_bi_ge/wal_mart_bank


WALMART WANTS IT ALL

First, imagine you live in a small town where Wal-Mart’s national economies of scale and “Always the Low Price” advantage have driven every bank in town out of business, except its own. (Unlikely you say? Talk to a few of the hundreds of local retailers whose failed businesses were no match for the buying power in Bentonville.)

Now imagine that you are thinking about starting a small retail business that competes with Wal-Mart in some way. (Almost every retailer does.) Let’s say it’s a retail nursery.

You need a start-up loan, so you go to Wal-Mart, ask the greeter where the loan department is and, after wending your way through the automotive supplies and window coverings departments, you find a loan officer (a bit green because he was just promoted from the garden shop).

He takes your application, which your CPA has assured you makes an airtight business case for the loan. Then he pores over your confidential business plan. The plan includes how you plan to compete with Wal-Mart.

For some reason, despite a sound plan, 20 years of experience as a manager in the nursery business, ample collateral and a solid credit rating, you are turned down for the loan.

You might suspect that the loan denial could be the result of a conflict of interest.

(I think this was in a Boston paper, but I've misplaced the source.)

At least, that was my first thought when I read this... :mad:

Just like the "factory towns" of old, Wal-Mart wants to have its hand in every piece of the pie - and its next move is managing your money.

Last September, Wal-Mart unveiled plans for the "Bank of Wal-Mart": an enormous power play to boost Wal-Mart's domination of our economy by creating one of the largest financial institutions in the country.

Together with the former and current Chairs of the Federal Reserve and over 50 members of Congress from both sides of the aisle, we rang the alarm bell and together we forced the FDIC to extend the public comment period and hold hearings on this important decision.

You stopped Wal-Mart from sneaking its bank through the process, and now it's time for you to weigh in on these hearings. We've found the email address to send comments to the FDIC - take a moment to compose your own thoughts and tell them why the Bank of Wal-Mart is a bad idea:

http://walmartwatch.com/tellafriend/bank

What does a "Bank of Wal-Mart" mean to you?

Stability is the bedrock of the American financial system, but the Bank of Wal-Mart would threaten that with a dangerous concentration of commercial and financial power. Even more troubling, Wal-Mart is using a recent loophole in federal law to establish its bank, which would be regulated by the FDIC and would not be subject to the same strict regulations as other banks that are regulated by the Federal Reserve.

And there's also concern about the economic impact of the Bank of Wal-Mart on your community. When the enormous bank comes to town, it will threaten the local alternatives, just like super centers have undermined so many other local stores. Then, with these critical centers of capital gone, local businesses that compete with Wal-Mart may be forced to rely on the retail giant's bank for loans.

I'm giving my testimony on April 11th, but it's important that your comments are heard before then. The FDIC wants to hear from the public, and we're missing a big opportunity to affect the debate if we're silent now. Take a moment to put your thoughts together and send them straight to the FDIC:

http://walmartwatch.com/tellafriend/bank

I look forward to browsing through your comments as I prepare for my own testimony. Once I'm done there, I'll be sure to follow-up and let you know where we are with this important issue.

Thanks for your continued support of Wal-Mart Watch.

Sincerely,

Andrew Grossman
Executive Director

Paid for by WalmartWatch.com, a campaign of Five Stones and The Center for Community and Corporate Ethics

They could provide 'low priced health care, always' !

Sign up and we'll give you 5% off on all purchases today only!

Bushism: the theory. Wal-Mart: the practice.

"We pay 0.000001%, the lowest in town!"

"Ooooh, d'ja hear THAT, Murleen? Them Wally-Mart banks have the LOWEST rates in town! Hot Damn! I'm gonna go dig-up the coffee can out behind the junkpile!"