Tuesday, May 22, 2007

Just In Case Target Tries It Too

Wal-Mart recently tried to get into the banking business, a move that would have been a serious threat to the banking industry precisely because it would have been service with a very attractive value proposition to consumers. Wal-Mart eventually abandoned the effort.

Apparently, that wasn't good enough, because the House has now passed a bill to limit any future attempts at such an enterprise:

Big retail stores like Home Depot and Wal-Mart would be barred from owning specialized banks known as industrial-loan companies under a House bill passed late Monday.

In a victory for the banking industry, the House approved a bill that would prohibit the Federal Deposit Insurance Corp. from granting new ILC charters to commercial companies. The vote was 371 to 16.
Bonus: One of the big opponents to companies such as Wal-Mart getting into the banking industry is House Financial Services Chairman Barney Frank, who a) has apparently been complaining about high credit card transaction fees charged by banks, and b) is featured in this video (HT: Club for Growth) about Democrats wasting taxpayer money flying around in military jets.


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