A parade of objectors spanning US business, unions and charities are going before federal regulators to make the case against allowing Wal-Mart Stores Inc to expand its empire into banking.
The first-ever public hearings on a bank application by the Federal Deposit Insurance Corp (FDIC) are drawing a wave of opposition to the move by the world's largest retailer. The company insists that consumers and retail banks have nothing to fear and is pledging to stay out of branch banking and consumer lending.
Some 300 institutions operate branches in 1,150 Wal-Mart stores and the company says it doesn't want to compete with them.
PHOTO: AFP
Opponents are not convinced. They portray Wal-Mart's proposed in-house bank -- which would handle the 140 million credit, debit card and electronic check payments the company handles each year -- as leading eventually to full-scale banking with retail branches that would destroy local banks.
Bentonville, Arkansas-based Wal-Mart already is too big, they say, with 3,900 stores nearly saturating the US market and unrivaled dominance -- accounting for 10 percent of the US retail economy, according to some researchers.
"Wal-Mart is a company that does not play by the rules," Robert McGarrah Jr, a corporate governance official with the AFL-CIO, said in a statement prepared for yesterday's hearing.
"That factor alone makes its proposed bank a threat to the taxpayers and the nation's banking system. Wal-Mart's record in communities across America reveals a company that ruthlessly wipes out important community businesses," McGarrah said.
In an unusual alignment, the banking industry, unions and consumer groups have come together to make the case that a Wal-Mart bank would unfairly concentrate power over retail and small-business lending in one company that is already the biggest business in many small towns and rural communities.
But Wal-Mart's proposal has its supporters, too, including the American Financial Services Association, which represents credit card issuers and other consumer lenders, and the Salvation Army and the National Center for Missing and Exploited Children, which receive donations from the retailer.
Supporters say a move by Wal-Mart into banking would benefit consumers by lowering fees and prices in an industry needing more vigorous competition.
Nearly 70 witnesses were due to testify, both for and against Wal-Mart's application for federal deposit insurance for a state-chartered bank in Utah, in FDIC hearings yesterday and today in Arlington, Virginia, and on April 25 in Overland Park, Kansas.
Among them: Congresswoman Stephanie Tubbs Jones, who heads a group of Democratic lawmakers opposed to the application; officials of trade groups representing banks of every type and size; unions; consumer and community organizations, and associations of convenience stores, grocers, retailers, real estate agents and farmers.
An unprecedented outpouring of 1,900 comment letters to the FDIC, most opposed to the application, prompted the agency to hold the hearings.
Over the past five years, Wal-Mart has tried unsuccessfully to buy financial institutions in California and Oklahoma and to partner with a bank in Canada. The California legislature, Congress and regulators blocked those deals over worries about big retailers getting into banking without full bank supervision.
This time, Wal-Mart is seeking to use a regulatory loophole that allows any type of company to own a certain sort of bank, known as an industrial loan corporation, or ILC, in California, Nevada or Utah.
ROLLER-COASTER RIDE: More than five earthquakes ranging from magnitude 4.4 to 5.5 on the Richter scale shook eastern Taiwan in rapid succession yesterday afternoon Back-to-back weather fronts are forecast to hit Taiwan this week, resulting in rain across the nation in the coming days, the Central Weather Administration said yesterday, as it also warned residents in mountainous regions to be wary of landslides and rockfalls. As the first front approached, sporadic rainfall began in central and northern parts of Taiwan yesterday, the agency said, adding that rain is forecast to intensify in those regions today, while brief showers would also affect other parts of the nation. A second weather system is forecast to arrive on Thursday, bringing additional rain to the whole nation until Sunday, it
CONDITIONAL: The PRC imposes secret requirements that the funding it provides cannot be spent in states with diplomatic relations with Taiwan, Emma Reilly said China has been bribing UN officials to obtain “special benefits” and to block funding from countries that have diplomatic ties with Taiwan, a former UN employee told the British House of Commons on Tuesday. At a House of Commons Foreign Affairs Committee hearing into “international relations within the multilateral system,” former Office of the UN High Commissioner for Human Rights (OHCHR) employee Emma Reilly said in a written statement that “Beijing paid bribes to the two successive Presidents of the [UN] General Assembly” during the two-year negotiation of the Sustainable Development Goals. Another way China exercises influence within the UN Secretariat is
LANDSLIDES POSSIBLE: The agency advised the public to avoid visiting mountainous regions due to more expected aftershocks and rainfall from a series of weather fronts A series of earthquakes over the past few days were likely aftershocks of the April 3 earthquake in Hualien County, with further aftershocks to be expected for up to a year, the Central Weather Administration (CWA) said yesterday. Based on the nation’s experience after the quake on Sept. 21, 1999, more aftershocks are possible over the next six months to a year, the agency said. A total of 103 earthquakes of magnitude 4 on the local magnitude scale or higher hit Hualien County from 5:08pm on Monday to 10:27am yesterday, with 27 of them exceeding magnitude 5. They included two, of magnitude
Taiwan’s first drag queen to compete on the internationally acclaimed RuPaul’s Drag Race, Nymphia Wind (妮妃雅), was on Friday crowned the “Next Drag Superstar.” Dressed in a sparkling banana dress, Nymphia Wind swept onto the stage for the final, and stole the show. “Taiwan this is for you,” she said right after show host RuPaul announced her as the winner. “To those who feel like they don’t belong, just remember to live fearlessly and to live their truth,” she said on stage. One of the frontrunners for the past 15 episodes, the 28-year-old breezed through to the final after weeks of showcasing her unique