Republic meets before judge with FDIC: The FDIC was supposed to bring an action against Republic Bank before an administrative judge. The hearing was scheduled for April 18th in Louisville. The FDIC is pursuing an argument that Republic’s refund anticipation loans undermine the safety and soundness of the bank. Republic will likely counter with data that shows how their RALs performed during this tax season.

The market seems to have decided that the FDIC won’t succeed. Republic’s stock is still at $20 a share. Unless investors are willing to grant a very high multiple to their shares, the price would seem to assume that RAL earnings are going to be available next year. Jackson Hewitt shares are floating at 60 cents.

Continental Prison Systems rolls on: Continental Prison System reached an agreement to put their EZ Card Kiosk in to Riker’s Island in New York City. The New York Post had reported that such a deal was under a discussion. A long time – 18 months – had passed since then and so this is a bit of a surprise. Now it is finally a reality. It also seems that CPSZ will get into the bail bonds business.

PMI Companies Disdainful of Qualified Residential Mortgage Rules: Kevin Schneider, CEO of Genworth and President of the trade group Mortgage Insurance Companies of America, contested the suggestion of putting a twenty percent exemption standard into the new QRM rules. According to Schneider, that rule would mean that a family with an income of $50,000 would need to save for 11 years before they could afford to buy a home priced at the average value in the United States ($153,000).

It would be a mistake to identify a potential regulatory intervention with the long-term problems that have led Jackson Hewitt to its current malaise.

Jackson Hewitt shares are trading at 55 cents a share this morning. That is off about 24 (more…)

News that Jackson Hewitt may be preparing a bankruptcy plan dropped its shares price significantly this morning. My first question is: “What took so long?”

Since the 5th and 6th Amendments to Jackson Hewitt’s 2006 Credit Agreement with Wells Fargo (via Wachovia), it has been clear that Wells was losing its patience with the (more…)

Republic Bancorp published a very upbeat update on its early tax season results (see 8-k here).  Republic says that TRS managed to increase net income within its Tax Refunds Solution division by 70 percent, compared to the same period in 2010, due to higher RAC volume, lower-than-expected default rates, and higher RAL margins.

Republic said that it sold 62 percent more RACs through the first two months of 2011, (more…)

Wells Fargo has given Jackson Hewitt a little breathing room.

Wells Fargo gave Jackson Hewitt a large line of credit ($105 million) in 2006. In December, Jackson Hewitt had $77 million available. In the past year, Wells has amended their agreement several times. Perhaps Wells is growing anxious (more…)