Spotlight on the Financial Services Industry

March 2000

As every creditor knows, personal bankruptcies soared in the U.S. between 1994 and 1998. Nearly 1.4 million U.S. households filed for bankruptcy protection in 1998, about a half million more than in 1995. Perhaps even more striking is the fact that from 1992 through 1998 one out of every 20 U.S. households filed for bankruptcy.

Consumer Confidence or Irrational Exuberance?

By the time an economic expansion becomes as long-in-the-tooth as the current one (9 years as of February, 2000), nagging signs that the end is near have usually appeared.

Borrowing Accelerated at the End of 1999

We reported last month that consumers appear to be building up their non-mortgage balances again, following a period in 1998-99 when non-mortgage debt per borrower actually fell.

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Debit Cards Pass Credit Cards in UK

The latest European Card Review reports that consumers’ expenditures on debit cards exceeded those on credit cards in December for the first time—quite a remarkable growth from its beginning in 1992.

Internet Order Centers

Bank of America is providing an Internet merchandising service that both encourages the use of credit cards and helps small businesses.

On-Line Lending

The growth of the Internet has created new opportunities for marketing and granting consumer credit.

Bad Credit Card Debt At Banks

Data compiled by Veribanc, Inc. show that, while serious delinquencies at commercial banks have hovered around two percent of outstandings, quarterly chargeoffs have declined slightly over the past two years.

Explaining the Escalation in Personal Bankruptcies

As every creditor knows, personal bankruptcies soared in the U.S. between 1994 and 1998.

Survey Of Consumer Finances

Every three years the Federal Reserve sponsors a survey of the financial condition of U.S. families.

Privacy Issues

Privacy concerns are at least as prevalent in other countries as they are in the U.S.

Voluntary Data Collection Under ECOA

A very thorny and contentious issue is whether or not the Equal Credit Opportunity Act (ECOA) should be amended to permit, but not require, a creditor to collect data on nonmortgage credit applicants’ sex, marital status, race, color and national origin for non-mortgage credit.

Arbitration Provisions

Arbitration agreements have been typical of brokerage firms for many years, but have been challenged in the case of credit card agreements.