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Unbanked Notes

Adam Rust's picture

Posted December 8, 2010

  • Green Dot sold 4.27 million class A common shares, pricing at approximately $61 per share, on Tuesday. The sale was their second public offering this year. They sold about 9 million shares in June, with a price of about $34.
  • A former Jackson Hewitt service manager was convicted this week on charges of falsifying the tax returns of her clients. The U.S. Justice Department said that she filed 20 returns that "she knew were false." The changes cost taxpayers $165,000.
  • In their most recent annual report, EZ Corp (EZ Pawn) reported that revenues increased 22.3 percent. Their auto lending segment, which derives revenues from fees on car title lending, increased revenues sixfold. Car title lending is only legal in about half of the US. EZ

    Corp also offers payday loans. Those "signature loans" performed very well, with a default rate (4.6 percent) well below the current default rates on sub-prime mortgages (more than 10 percent) and credit cards (slightly less than 10 percent) across the United States.

  • This is unusual: the Department of Justice announced that it reached a settlement today with PrimeLending. DOJ said that Prime exhibited a pattern of racial discrimination in targeting African-Americans for predatory loan products. In the suit, DOJ said that African-Americans paid more for prime fixed rate FHA mortgage loans. Prime was one of the nation's top 20 FHA lenders in 2009, with approximately $5.5 billion in originations. PrimeLending is a subsidiary of PlainsCapital Bank of Lubbock, Texas.
  • A new Federal Reserve report shows how the payments system is changing. In 2009, there were 37.9 billion debit card payments, 21.6 billion credit card payments, 19.1 billion ACH payments, and and 6 billion prepaid card payments. ┬áPrepaid was the fastest growing means of payment. Credit card payment volume declined.