Magazine article American Banker

Insurance Group's Plans for Thrift Charter Stir Debate

Magazine article American Banker

Insurance Group's Plans for Thrift Charter Stir Debate

Article excerpt

Last week the National Association of Mutual Insurance Companies announced plans to charter a thrift so its members can make loans to policyholders.

The Indianapolis-based group-whose 1,200 members account for a third of all property/casualty insurance premiums in the United States-figures the people who buy personal, agricultural, and small-business insurance will take out personal, farm, and small commercial loans as well.

The trade group follows five companies, including industry giant State Farm, to the Office of Thrift Supervision, where thrift charter applications are decided.

American Banker asked several people to react to the insurance industry's interest in entering the banking business.

Alice M. Dittman, chairman, Cornhusker Bank, Lincoln, Neb.

This is one more part of our business on the chopping block. We don't like it. They are chartering a unitary thrift that has more powers than a bank, and it gives them entry into the area of commerce. That is something that banks under the current rules cannot compete with.

David J. Pratt, senior vice president of federal affairs, American Insurance Association

We have been telling our members for more than a year that it would be a good idea to apply for a thrift charter. It is prudent to at least look at that option. This is a way for insurance companies to remain competitive as banks move into the insurance business.

A federal thrift charter offers an insurance company a uniform set of rules and a good distribution option. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.