LowCards Credit Card Update July 22, 2011

July 22, 2011, Written By sitemanager

MORE CREDIT USERS PAYING BILLS ON TIME, BANKS SEEING PROFITS
The nation’s top credit card companies are seeing a boost to their bottom
lines as consumers are getting better about paying their bills on time. Five
of the top six card issuers said the rates at which their customers
defaulted on their accounts fell in June. Bank of America Corp. reported the
biggest drop in defaults, with JPMorgan Chase & Co. and Discover Financial
Services also showing significant improvement. The impact of the improved
payment habits was reflected in banks’ second-quarter financial results this
week. Card holders are using their credit cards more. Citigroup said
purchase volume rose 1.5 percent. JPMorgan Chase’s customers spent 10
percent more using their cards. Discover said sales volume on its namesake
cards rose 9 percent.

Story by Eileen AJ Connelly for the Associated Press

http://www.suntimes.com/business/6540055-420/more-credit-card-users-paying-bills-on-time-banks-seeing-profits.html

WHEN YOUR DOCTOR SELLS CREDIT CARDS
Should you finance your plastic surgery with plastic? Credit card issuers
are stepping up their marketing of health-care cards and lines of credit
that help borrowers finance costly elective medical procedures. The cards,
which typically boast initial interest rates of 0%, are targeted to clients
of plastic surgeons, dentists and even veterinarians. Though they help some
people pay for important procedures, the cards come with a number of
drawbacks that may not be apparent at sign-up, including rates that can
quickly spike. Some big firms are ramping up their offerings. Citigroup Inc.
offers the Citi Health Card, while J.P. Morgan Chase & Co. pitches
ChaseHealthAdvance, a line of credit aimed at helping customers finance
elective health procedures such as corrective eye surgery. For providers,
the cards promise relief from billing headaches and the expense of wrangling
cash from patients. The cards also can drive up business, since they allow
patients to finance expensive elective procedures they might otherwise
forgo. But for some patients, the cards can lead to medical-billing
nightmares, according to Minnesota Attorney General Lori Swanson, who says
that her office has seen a surge in complaints about the cards over the past
year. Another problem, say consumer advocates, is that medical providers
charge patients for the full cost of a procedure at the first visit even
before multistage medical work is completed. If patients are dissatisfied
with their care, it is difficult to dispute since they already have been
charged for it.

Story by Jessica Silver-Greenberg for the Wall Street Journal

http://online.wsj.com/article/SB10001424052702304584404576440352578239090.html

CREDIT CARD ISSUERS PAID OVER $73 MILLION
TO UNIVERSITIES AND INSTITUTIONS IN 2010
The number of credit cards issued to college students and alumni
associations in 2010 dropped 17%, while the revenue that schools receive
from the card issuers declined 13%. These are the results of a study
released last week by the Federal Reserve. It shows the effects of one of
the provisions of the CARD Act where credit card issuers are required to
submit copies of all college credit card agreements. Issuers must also
include the number of credit card accounts opened pursuant to the agreement,
the amount of payments made by the issuer to the institution or organization
during the year, and the number of new college credit card accounts that
were opened during the year. Fewer cards means smaller payments to colleges.
Issuers paid $73,261,906 to college institutions or college organizations in
2010. This represented a decrease of $11,200,859 or 13 percent versus year
ago levels.

https://www.lowcards.com/blog/issuers-paid-over-11m-to-universities-and-institutions-in-2010-2465/

DODD-FRANK UNDER FIRE A YEAR LATER
In the year since the passage of a sweeping overhaul of the nation’s
financial regulatory system after the financial crisis, the stock market is
up, banking profits have grown and institutions that invest on behalf of
average Americans are praising the tougher stance in Washington. But there
remain signs that the tightened regulatory measures could still be undone,
creating uncertainty about whether the actions that have helped to stabilize
Wall Street will be in place when the next crisis hits. Two dozen bills in
Congress seek to dismantle parts of the Dodd-Frank Act, which President
Obama signed a year ago. Business groups have argued that too many new
regulations could snuff out the start of an economic recovery. Senate
Republicans are refusing to consider nominations for posts at several
financial regulatory agencies. Lawmakers have taken aim at agencies for
budget cuts. Administration officials say that banking and business
lobbyists have spent more than $50 million this year to try to change the
law.

Story by Edward Wyatt for the New York Times.

http://www.nytimes.com/2011/07/19/business/dodd-frank-under-fire-a-year-later.html?ref=business

MOST DODD-FRANK CHANGES STILL TO COME
A year after the passage of sweeping financial reform, the biggest changes
to the regulatory landscape are still to come. Already big financial
institutions are grappling with new debit card swipe fee costs, higher
deposit insurance fees and capital restrictions called for in the statute.
Yet, the vast majority of changes–including structural alterations to big
bank business models–are yet to come. According to a study by the
international law firm of Davis Polk, as of July 1, regulators have
completed only about 12% of the 400 rule-making requirements in Dodd-Frank,
and further, 122 deadlines set in the statue for adopting key bank reform
regulations and issuing studies have been missed.

Story by Robert D. Orol for MarketWatch

http://www.marketwatch.com/story/one-year-on-most-dodd-frank-changes-still-to-come-2011-07-21

OBAMA TO PICK FORMER OHIO ATTORNEY GENERAL FOR POST
President Barack Obama said he will nominate former Ohio Attorney General
Richard Cordray to lead the Consumer Financial Protection Bureau, which
opened Thursday amid continuing political fights about its scope. Elizabeth
Warren developed the idea for the new agency and was appointed by Obama last
fall to set it up. Warren’s prospects for becoming director of the bureau
suffered a setback last year when Christopher Dodd, the Connecticut Democrat
then in charge of the Senate Banking Committee, said she couldn’t win
confirmation. Warren is a Harvard professor and will return to Harvard in
the fall, according to a person briefed on her plans.

Story by Carter Dougherty and Mike Dorning for Bloomberg

http://www.bloomberg.com/news/2011-07-18/obama-to-pick-former-ohio-attorney-general-for-consumer-post.html

RECORD CUSTOMER SPENDING BOOSTS AMEX 2Q
BUT REWARD EXPENSES ALSO INCREASED
Record customer spending on American Express cards led the company’s
second-quarter profit to leap 31 percent. Revenue jumped 12 percent to $7.62
billion from $6.81 billion last year. Customer spending reached an all-time
high, rising 15 percent to $207.6 billion, with growth seen throughout the
world. That averaged out to $3,767 per customer for the quarter. Chief
Financial Officer Daniel Henry said balances rose 6 percent during the
quarter. One factor that got analysts’ attention was an increase in
expenses, which rose 21 percent, to $5.5 billion. In particular, card member
rewards expenses jumped 35 percent to $1.61 billion. Henry said the higher
rewards costs came from improvements in its program that encourage customers
to earn more points and redeem more rewards. American Express also saw more
expensive types of rewards claimed, he said, without detailing exactly what
they were.

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The information contained within this article was accurate as of July 22, 2011. For up-to-date
information on any of the terms, cards or offers mentioned above, visit the issuer's website.