GCRC/Global Coalition for Community Reinvestment and Responsible Credit

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Below is an article analyzing the what-ifs of Royal Bank of Scotland's U.S. subsidiaries Charter One and Citizens Banks being sold off, now that the UK government owns more then half of RBS. While listing the big banks which probably won't make it bid, it hypes Capital One, Morgan Stanley, Suntrust and Regions, saying that the last two might use their US government TARP... [more...]

Hosted by NALSAR, the conference held from 25-27 Feb 2009 in Hyderabad, is especially designed for consumer law experts and has an eminent panel of speakers planned. We hope to gather stakeholders from the world over and continue to discuss our Principles of Responsible Credit! ----- 12TH INTERNATIONAL CONFERENCE ON CONSUMER LAW HYDERABAD 25-27 FEBRUARY 2009 The 12th... [more...]

ECRC and US partner NCRC are happy to have the ‘London Declaration’ available in an increasing number of languages. Thanks to BRASILCON, Brazilian Institute of Policy and Consumers Law, these now exist in Portuguese too. We look forward to the reaction that the Brazilian Public Authorities will have when the London Declaration and the ECRC Principles of Responsible Credit... [more...]

IN THESE HARD TIMES, EASY CREDIT COMES BACK TO HAUNT CARD USER (Live Mint Money Matters, Krittivas Mukherjee / Reuters) New Delhi: Credit is a devil that dances in empty pockets,” was the advice P.V. Rajiv’s father gave him when the young salesman swiped his new credit card for the first time to buy an expensive watch he could hardly afford. Swiping debt: A petrol pump... [more...]

In this short piece, we describe the process by which Japan came to regulate interest rates and to require that lenders not lend too much to any borrower. We welcome any comment. [more...]

SUB-PRIME MORTGAGES - FANNIE, FREDDIE RIDE FORECLOSURE FREEZE TIDE (BY SCOTT SABATINI, Legal News Line) WASHINGTON (Legal Newsline)--As Capitol Hill remains under siege from all sides of America's faltering economy, pressure to stem the tide of foreclosures continued to make inroads as Fannie Mae and Freddie Mac became the latest to join the foreclosure freeze movement. ... [more...]

Friends of the Earth and BankTrack show in their report that China’s “Green Credit Policy” will make a difference. In the current economic climate, where banks are themselves relying on external funds from the public purse, is it possible to apply a similar set of regulation to China’s but aimed at controlling the “responsible credit” impact of the bank’s consumer lending... [more...]

NEWS RELEASE November 19, 2008, Contact: Robert M. Garsson (202) 874-5770 COMPTROLLER DUGAN SAYS CRA NOT RESPONSIBLE FOR SUBPRIME LENDING ABUSES BALTIMORE — Comptroller of the Currency John C. Dugan said he categorically disagrees with suggestions that the Community Reinvestment Act is partly responsible for the ongoing credit crisis. “CRA is not the culprit behind... [more...]

Udo Reifner, Hamburg "Change" – Financial Services and the Credit Crisis Introduction to the 8th International Responsible Credit Conference London 2008: “Global banking in crisis! Now is the time for Responsible Credit” 13/14 November 2008 – New Connaught Rooms, London Two days before the leaders of the worlds' most... [more...]

ECRC’s South African partner You and Your Money, took part in our international conference in London. General Director, Johann Magerman, is grateful to have attended the conference and says the experience proved to be a rich and rewarding one, as one was able to connect with people from diverse cultures and backgrounds. Johann will be one of several international partners... [more...]

Madrid, November 6 2008 BankTrack today released "Bank to the Future: El Escorial Statement on Banks and the Financial Crisis" at a press conference in Madrid. The statement was drafted at BankTrack's annual strategy meeting, held in El Escorial de San Lorenzo earlier this week. It contains BankTracks´ current position on what is needed to deal with the unfolding... [more...]

The conference was a success and the report (Franco-Anglo) is available as an attachment below. The 7th Internationale Meeting on Ethics, Finance & Responsibility was hold on the 3rd and 4th of October 2008, in Geneva. WORKSHOPS: Emilio Fontela Lecture: Economics and the Common Good - Protestants, Catholics and Money - Was Hippocrates a Financier? Finance and Medicine -... [more...]

GM'S FINANCE ARM SEEKS TO BECOME BANK CHICAGO: The troubled financial arm of auto giant General Motors is seeking to become a federally regulated bank holding company in a move which wou ld give it access to a share of a 700 billion dollar bailout package, GMAC said Thursday. GMAC said it intends to launch a private offer to "exchange a significant amount of its... [more...]

AT UN, STIGLITZ SLAMS CHASE FOR MISUSE OF BAILOUT, FEDERAL RESERVE FOR PREDATORY LENDING (By Matthew Russell Lee of Inner City Press) UNITED NATIONS, October 30 -- The $700 billion bank bailout should not be used for mergers to increase market share, economist Joseph Stiglitz told the Press on Thursday. Following a UN panel discussion about the global financial crisis,... [more...]

Money is an irrigation system. If it is distributed in well kept tubes, canals, guided by dams and digs it may create a flourishing landscape und fertile soil. If it is unregulated or if dams have been torn down we call it a flood or even a Tsunami which destroys landscapes. During the neo-liberal move of the 1990ties and beyond, the "new" political waves (neo-cons,... [more...]

There is a lack of independent expertise in this credit crisis. There is a lack of long term perspectives in the present debate. iff and ECRC have tried to explain the crisis in many tv appearances in Germany during the last weeks and have provided easy to understand analysis and recommendations for German citizens. ECRC's central contribution is the Declaration on the... [more...]

Nadja Jungmann from the Netherlands sent us her report for for the Dutch ministry of Social Affairs on Overindebtedness as well as the letter the minister sent to the parliament. Although the Netherlands has already a sophisticated and well functioning personal bankruptcy schemes which allows for debt relief within four years, the most important result of the report is... [more...]

The UK's Channel 4 News programme has featured the growing problem of payday loans, including undercover filming of lenders including The Moneyshop (U.S firm Dollar Financial's trading name in the UK). The coverage, which includes comment from ECRC member, Debt on our Doorstep, reveals that payday loans are offered for up to six months at which point interest charges... [more...]

Responsible Credit 2008, the 8th International Conference on Financial Services, organised by ECRC, NCRC, and UK partner, Inclusion, is now open for bookings. The conference will take place in London's Covent Garden on 13th and 14th November, and bookings are being taken through Inclusion's website at the link below. A draft programme is also attached below. Please sign up. [more...]

Two articles below show the renewed interest by regulators in responsible credit. CALL FOR ACTION ON PAYDAY LOANS (BBC, live interview with Damon Gibbons on Saturday 26th July) Debt advice groups are calling for urgent action over payday loans that charge extremely high interest rates. They want the market regulator to make lenders behave responsibly, as some... [more...]

The Office of Fair Trading in the UK has announced that it is to start a year long project investigating responsibility in lending in response to calls from ECRC member, Debt on our Doorstep. The announcement followed national media attention in the UK concerning payday loans, with the BBC broadcasting a live interview with Damon Gibbons on Saturday 26th July. A link is... [more...]

Hi -- even during summer subprime melt-down here in the U.S., big subprimers HSBC (Household) and AIG continue to grow overseas. And in Australia, moves to make credit histories more detailed. One day, the U.S. merger market will revive... Stay cool, -Matthew Matthew Lee, Esq., Executive Director Inner City Press / Fair Finance Watch NCRC Board member - Global - NCRC blog... [more...]

WHAT DOES FINANCIAL EXCLUSION MEAN - A CRITICAL ASSESSMENT OF THE UNDERLYING APPROACH The project on financial inclusion which DG Social Policy mandated to a group of people from the debt advice asked the question how exclusion from financial services could be overcome. The summary of their findings as well as the study itself is annexed. The conclusions are summarized... [more...]

The Age - Melbourne,Victoria,Australia, Annabel Stafford, July 4, 2008 DEAL ON CONSUMER CREDIT DODGY pay-day lenders and unscrupulous companies that hand credit cards to teenagers may soon face tougher regulation after state and territory leaders agreed to centralise the responsibility for regulating consumer credit in Canberra. The Council of Australian Governments had... [more...]

FLAC (Free Legal Advice Centres) today backed calls by the European Coalition for Responsible Credit (ECRC) in its ‘Declaration on the Credit Crisis’ for the EU and national governments to restore confidence and stability in the financial markets and to protect consumers from the consequences of the irresponsible lending. The declaration, from a coalition of... [more...]

There are striking similarities between the activities of DG Market of the European Commission and Capital Hill as the reactions to the subprime crisis is concerned. While many including the Head of the Federal Reserve think it is time to educate bankers to be more cautious, provide more responsible credit and refrain from profiting from the needs of poor people an... [more...]

The seven ECRC Principles of Responsible Credit who have been signed by organisations all over the world are more and more taken into account in public discussions. Still in 2008 the first CSR-Rating concerning banks will be based on these principles and the respective bank behaviour. The principles are all availabe on this website at the below mentioned places. They... [more...]

Treasury website: GREEN PAPER ON FINANCIAL SERVICES AND CREDIT REFORM Date: Tuesday, 3 June 2008 ABSTRACT: Green Paper on Financial Services and Credit Reform – Improving, Simplifying and Standardising Financial Services and Credit Regulation The purpose of this Green Paper is to consult stakeholders about the following range of financial services and credit reform... [more...]

Financial Sector meets Client Sector - For the third time German stakeholders in financial services will meet in Hamburg and discuss issues like financial education, the international credit crisis, risk management in consumer credit contracts, the future of debt advice, investors' prpotection rules, the implementation of the EU Consumer Credit Directive 2008, protected... [more...]

Find annexed the paper Bob Schmitz from the Luxembourg Consumer Association a partner of ECRC has presented to the European Parliament with regard to the efforts of the Eu-Commission in Financial Education or as officials and some banks prefer Financial Literacy or even Financial Capability: 1. Consumer empowerment via information and education – serious limits We are... [more...]

NOTE: the impacts of the U.S. subprime implosion continue to spread, including in Africa, where as reflected below, lending is decreasing (but unlike in the U.S. right now, mergers continue). Meanwhile, Citigroup for example has re-affirmed its commitment to consumer finance in emerging markets like India, see below, while it has laid off subprime employees in the UK --... [more...]

WEATHER THE PERFECT STORM (www.theage.com.au, Kelsey Munro, April 23, 2008) High interest rates and faltering property values in Australia and recession in the US are creating "the perfect storm" for debt-laden consumers, according to the author of a research paper on mortgage stress. Fujitsu Consulting and JP Morgan's latest data predict that almost 1 million households... [more...]

CONSUMER INSURANCE SEEN AS SCAM, SAYS JUDGE (Dispatch Online - South Africa) CONSUMER credit insurance in SA has a bad name and is seen by many as a scam or a rip-off, Judge Peet Nienaber noted in a report on an inquiry into the industry released yesterday. However, not all the reasons for this are necessarily valid, and it is always necessary to distinguish between... [more...]

'SUB SUB SUB SUBPRIME' BORROWERS 100 MILLION STRONG WORLDWIDE AND GROWING (By Jamie Zimmerman, April 17, 2008, New America Foundation - Washington DC USA) It's all we hear about these days: The U.S. subprime mortgage bubble -- created by poor and at times predatory lending practices and lax banking regulation and creative investment products -- has burst. Of the... [more...]

US BANKS EXTEND PRICIER LOANS TO MINORITIES STUDY TUE APR 8, 2008 1:05AM ED WASHINGTON (Reuters) - The largest U.S. banks gave expensive subprime mortgages twice as often to minorities than whites last year, according to a study of bank loan data released by a fair lending activist group on Monday. The study, conducted by Inner City Press/Fair Finance Watch found that... [more...]

Usurious fees can still be hidden in insurance products without disclosure in the Interest Rate of the Credit. As the request for such usurious insurance contracts has to be made before the acceptance of the credit by the bank it is rather ridiculous that the Directive call such contracts an expression of the free will of the consumer. Variable rate credit which helped... [more...]

THE EU-PROJECT The EU-Commission finances a project to build a European Contract Code which will be primarily based on international sales law principles and the form consumer protection as information and competition law has got within the EU-Directives. While in practice workers' and tenants' protection as well as debtors' protection has since long left the area of pure... [more...]

The National Community Reinvestment Coalition will be holding its annual event next week. ECRC partners that would like to attend have been invited by NCRC to sign up for a sponsorship. The 3 day event is a great opportunity to not only hear experts, including Fed Chairman Bernanke, but receive training in community building and how to enhance the effectiveness of... [more...]

The Comptroller of the Currency will ensure that data be provided to them on all mortgage lending (and will include all home equity loans in the future as well).This will complement the data received on only subprime lending which will be collected via the HOPE NOW alliance. Banks have cooperated, and hopefully unnecessary foreclosures will be avoided as the OCC and other... [more...]

The Public Service Commission, an independent and impartial body created by the South African Constitution to enhance excellence in governance within the Public Service presents a report on the investigation into the impact of micro-lending and garnishee orders on public servants and its implications for the Public Service. ------------- Article from the Times South... [more...]

European Parliament legislative resolution of 16 January 2008 on the common position adopted by the Council with a view to the adoption of a directive of the European Parliament and of the Council on credit agreements for consumers and repealing Council Directive 87/102/EEC (9948/2/2007 – C6-0315/2007 – 2002/0222(COD)) (Codecision procedure: second reading) ... [more...]

The Ugly Side of microlending as seen in Mexico, reported in Business Week HOW BIG MEXICAN BANKS PROFIT AS MANY POOR BORROWERS GET TRAPPED IN A MAZE OF DEBT (Business Week 13 Dec07, by Keith Epstein and Geri Smith) In a gleaming office tower in Mexico City secured with retinal scanners, bulletproof glass, and armed guards, dozens of workers in white lab coats dart... [more...]

The Comptroller of the Currency has urged Congress to restore the original scope of the public welfare investment authority of national banks. It raises questions such as should the Community Reinvestment Act be broadened to cover non-banks too, especially since they have been responsible for over half of subprime mortgages leading to the crisis. One argument is that... [more...]

REGULATOR WARNS ERRANT MICROLENDERS (Regis Nyamakanga, Business Day - Johannesburg,South Africa, 31 January 2008) THE National Credit Regulator threatened yesterday to deregister and prosecute nearly 20 microlenders for allegedly flouting the National Credit Act, which was promulgated last year to help regulate SA’s R850bn consumer credit industry. Investigations and... [more...]

GERMAN WELFARE RECIPIENTS AND US SUPRIME CRISIS American subprime lenders sold their high interest portfolios of mortage loans to investors all over the world who like the Saxon German Public Bank (SachsenLB) even borrowed about 20 billion € from other banks to buy these papers with a high yield so that they could pretend profitability. The fantastic dream of country side... [more...]

Microfinance needs a discussion. The German Kreditanstalt für Wiederaufbau and the Frankfrut Based Finance Institute sponsored by major banks will hold a conference in Frankfurt Germany on February 22, 2008 which will discuss "responsible finance" In this they want to address Microfinance which is headed by the following question. "With the growing diversity of the... [more...]

European Parliament has passed the New Consumer Credit Directive. It will now only formally go back to the Council to be agreed. EARLY REPAYMENT FEES The Socialist Deputies of the Parliament as well as consumer organisations managed half victory in early repayment fees. Yes, we will have such fees in future. Getting rid of one's debt will be a costly business and... [more...]

In its FinFocus Infoletter No 4 2007 addressed especially to a broad audience and issued on December 2007 the European Commission gives its view of the subprime mortgage crisis. FIN-FOCUS Newsletter "US sub-prime mortgage crisis – does it affect Europe? How did the crisis start? The sub-prime mortgage financial crisis began in the United States in 2006. Loans were... [more...]

December 17, 2007 A Very Profitable Sector Interview by Andrei Zolotov, Jr. Russia Profile Former Finance Minister Mikhail Zadornov is one of the best-known figures in the Russian economic establishment. After a long career in the government, including many years in the Duma, where he held numerous posts related to budgetary planning and Russia’s relations with... [more...]

SECOND TRY The second try of the EU-Commission to find a common definition on "overindebtedness" after DG Sanco mandated similar research in 2000 has now be made public in a conference launched by DG Social Policy. We have already expressed our reservations with regard to the selection of these contractors for such an important research. OEE, CEPS and ECRI are directly... [more...]