Events Calendar
In This Section
Day with Warren Buffett enriching to UA students
WISDOM FROM BILLIONAIRE WARREN BUFFETT
FedEx says IRS won't be imposing penalties
U.S. Walmarts to stay open Thanksgiving
WOMEN'S LEADERSHIP PROGRAM MAKES DEBUT
Regulators eyeing Ally Bank tactics
Number of females in unions increasing
Most Read Stories
Suitcase causes bomb scare at Akron bus terminal
Akron City Council OKs higher speed on I-77
Chapel Hill isn't rolling right along
Motorcyclist killed, wife injured in Stark County crash
New eateries expand menu of options
Man says he was punched, robbed by 3 people in parking lot
Patrick McManamon: Here's what the Browns should try the rest of the season
Louisville athlete commits to play for Boston College
Family found dead in Ohio home
Blogs:
Pets:
It Takes All Kinds
The Heldenfiles:
Tuesday Notebook
Patrick McManamon:
An interesting thought from a reader
Akron Zips:
Akron vs. Mount Union — Liveblog
Tribe Matters:
Indians announce spring dates
Cleveland Browns:
Mangini doesn't name a quarterback
Kent State Sports:
Flashes interested in another Cincinnati player
Cleveland Cavaliers:
Shaq: It’s All About Winning Championships
Buckeye Blogging:
Buckeyes Roll 100-60 / Season Outlook
Varsity Letters:
Report: Walsh baseball player commits
All Da King's Men:
More On The Fort Hood Jihadist
Blog of Mass Destruction:
Simply Incapable of Telling The Truth
Akron Law Café:
Health Care Financing Reform: (63) Commonwealth Fund Report on Primary Care
See Jane Style:
Muffle Your Muffler
Car Chase:
Clock Tender- Extending the Life of Collector Car Clocks
Let's Talk Real Estate:
Rumors: Akron Starbucks Closing
Ohio Travels with Betty:
Jack is looking for a trip to Southern Ohio the week of November 16.
Sound Check:
Aeromsith looking for new singer as Steven Tyler contemplates solo career
HRLite House:
Personal Rant – Why People Do Not Live in Northeast Ohio
Akron Gamer:
Video: 'Modern Warfare 2' hits the streets
By M.R. Kropko
Associated Press
POSTED: 11:43 a.m. EDT, Sep 08, 2008
CLEVELAND: Freezing credit lines often angers bank customers, so National City Corp.'s $200 incentive is an effort to persuade customers to agree to close their lines.
''What they are saying is that this will benefit the bank, and they are willing to compensate customers for that,'' said American Bankers Association senior economist Keith Leggett.
National City is trying to recover from steep losses in the home mortgage market. The $200 offer is to close equity lines that don't have a balance.
The Cleveland-based bank arranged a $7 billion capital infusion in April.
National City began prohibiting some customers from borrowing more on their equity lines last spring as home values fell and credit markets tightened. The bank targeted those with first and second mortgages that looked to be more than their updated lower home value.
The $200 is being offered to customers who have no balance on their home equity lines and were not drawing on their line, National City spokeswoman Kelly Wagner Amen said. The bank, which operates primarily in the Midwest and Florida, wouldn't disclose how many offers it's made, to which customers or where.
A bank must place money in reserve whenever a customer borrows from their credit line, and because of the uncertain credit market, banks are looking to preserve capital, Leggett said.
Leggett said he hasn't heard of any other bank, besides National City, that's offering customers an incentive to close a credit line.
''If it's very successful, you may find other banks will follow suit,'' he said. ''Not everybody will, but it's an interesting experiment.''
National City for the quarter ended June 30 reported a loss of $1.76 billion, or $2.45 per share, compared with a profit of $347 million, or 60 cents per share, in the second quarter of 2007. The results included a $1.1 billion goodwill impairment charge related to previous acquisitions. Goodwill typically reflects the value of an intangible asset.
CLEVELAND: Freezing credit lines often angers bank customers, so National City Corp.'s $200 incentive is an effort to persuade customers to agree to close their lines.
''What they are saying is that this will benefit the bank, and they are willing to compensate customers for that,'' said American Bankers Association senior economist Keith Leggett.
National City is trying to recover from steep losses in the home mortgage market. The $200 offer is to close equity lines that don't have a balance.
The Cleveland-based bank arranged a $7 billion capital infusion in April.
National City began prohibiting some customers from borrowing more on their equity lines last spring as home values fell and credit markets tightened. The bank targeted those with first and second mortgages that looked to be more than their updated lower home value.
The $200 is being offered to customers who have no balance on their home equity lines and were not drawing on their line, National City spokeswoman Kelly Wagner Amen said. The bank, which operates primarily in the Midwest and Florida, wouldn't disclose how many offers it's made, to which customers or where.
A bank must place money in reserve whenever a customer borrows from their credit line, and because of the uncertain credit market, banks are looking to preserve capital, Leggett said.
Leggett said he hasn't heard of any other bank, besides National City, that's offering customers an incentive to close a credit line.
''If it's very successful, you may find other banks will follow suit,'' he said. ''Not everybody will, but it's an interesting experiment.''
National City for the quarter ended June 30 reported a loss of $1.76 billion, or $2.45 per share, compared with a profit of $347 million, or 60 cents per share, in the second quarter of 2007. The results included a $1.1 billion goodwill impairment charge related to previous acquisitions. Goodwill typically reflects the value of an intangible asset.
Comments
Click here to post your comments
Akron, OH
Posted 11:56 AM, 09/08/2008
This actually sounds like a decent deal, considering the current market situation.
akron, oh
Posted 02:57 PM, 09/08/2008
Mine just sent me a letter. Saying They closed our line of credit that we had available.. Because the homes had all gone down in value in my area.... So this is better than countrywide.
Posted 07:46 AM, 09/11/2008
the browns just traded derek anderson to new england for a first and third round pick. how cool is that?
