On Thursday afternoon, MetaBank made it official that they will not offer tax-related products for the upcoming tax season.
The OTS issued a directive earlier this year that forced MetaBank to suspend its i-advance loans. The OTS also said that the bank would have to have permission before they could provide tax products like refund anticipation loans (RALs) and refund anticipation checks (RACs).
While it remains possible that the OTS will eventually grant the permission to provide those RACs and RALs, time has run out for the 2011 tax season. In an 8-K released after the bell on Thursday, MetaBank told investors that they would not participate in the upcoming year.
Following these Supervisory Directives, management of MPS has been in discussions with various third parties regarding the structure and fees of tax-related programs which could be submitted to the OTS for approval. In light of requirements imposed on MPS for any proposed programs to be submitted for OTS approval and the timeline for expected OTS review, MPS has concluded that it is unlikely to offer these tax-related programs during the upcoming 2011tax season. MPS has been in discussions with one of its primary program managers of the tax-related programs regarding a mutual agreement to terminate the program agreement for the 2011 tax season. During the pendency of those discussions, that program manager provided MPS its notice of termination on November 30, 2010.
I imagine that the program manager in question is Santa Barbara Tax Products Group. SBTPG has already said that they will not provide RALs this year, but they have been seeking a means to provide refund transfers. The impact of the MetaBank 8-K on SBTPG is purely speculation on my part, though.