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Refund Anticipation Loans

Refund Loans at Republic in 2012

Adam Rust's picture

Posted July 1, 2011

A tax preparer in Texas tells me that Republic is telling its ERO partners that they will be able to offer refund loans for part of the 2012 tax season.

Republic is telling aggregators - the folks that provide middle-path services that help EROS file to the bank - that the FDIC has decided to push back their final hearing with Republic until the first week in February of 2012.

On Friday, I spoke with a Republic salesperson who said that as of last week, they were instructed to tell EROs that they would have bank products in 2012.

A Republic spokesperson emphasized that the most recent 10-q stated that the hearing would take place in September. Republic would indicate any change to that hearing date with the next 10-q, due out before the end of July.

If the hearing is pushed back, then Republic would be able to offer loans through part of the busy

FDIC Punishes Republic Bank for ECOA, TILA, FTCA Violations

Adam Rust's picture

Posted May 5, 2011

The FDIC has charged Republic Bank for violations of multiple laws and set a civil money penalty of $2 millions for problems with their refund anticipation loan unit.

Republic Bank faces violations of the Truth-in-Lending Act, the Equal Credit Opportunity Act, the Federal Trade Commission Act, and the Gramm-Leach-Bliley Act. Additionally,

Jackson Hewitt Gets Extension on Credit Agreement

Adam Rust's picture

Posted May 2, 2011

Jackson Hewitt agreed to an amended credit agreement with Wells Fargo on Friday evening. The new "Amended and Restated Credit Agreement" gives JTX another 20 days. It comes with explicit instructions for how Jackson Hewitt spends its money for the duration of the off-tax season period.

Jackson Hewitt has a line of credit with Wells Fargo. No one can be certain how much

Republic Gives Optimistic Report on Early RALs

Adam Rust's picture

Posted March 1, 2011

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,

River City Bank Drops RAL Program

Adam Rust's picture

Posted February 16, 2011

River City Bank has conceded to an FDIC request that they exit the refund anticipation loan market. River City announced the decision on their Tax Division website yesterday afternoon.

The news means that two of the three remaining refund anticipation loan providers will drop RALs. Neither is going to exit immediately and both will run their programs through the end of this tax season. By a recent estimate in a US

With FDIC Suggestion, Ohio Valley Walks Away from RALs

Adam Rust's picture

Posted February 14, 2011

Ohio Valley Bancorp's Board of Directors has decided to close down its refund anticipation says the FDIC has recommended the bank to wind down its refund anticipation loan business.  Ohio Valley released the news in an 8-k this morning, although the communication from the FDIC arrived on Feb. 3rd.

There is an interesting wrinkle in the language. Whereas Republic's 8-K describes a "Notice of Charges for an Order to Cease and Desist," Ohio Valley's explanation is more tepid. In their document, it says that the bank received a

Reaction to the OCC RAL Directive

Adam Rust's picture

Posted December 27, 2010

People have a lot of questions about the OCC's directive to make HSBC end their Settlement Products Agreement with H&R Block.

Here are a few:

  • Why did the OCC do it?
  • Will the FDIC do the same thing?
  • Will H&R Block be able to come up with a substitute means of helping their customers settle the cost of their tax preparation fees?

HSBC reports that the OCC required them to terminate their contract, known as the HSBC Settlement Products Program, on Christmas Eve. Block's 8-K reports that the OCC directive required HSBC to immediately stop providing any form of refund anticipation loans and refund


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