FACTBOX-U.S. has 61 ILC banks, mostly in Utah


Jan 31 (Reuters) - Industrial loan companies (ILCs) are a fast-growing U.S. industry of 61 specialty banks, more than half of them in Utah, with combined assets totaling $155 billion.

ILCs are state-chartered institutions with broad banking powers that are regulated by the Federal Deposit Insurance Corporation and state banking officials. Because ILCs are not subject to Federal Reserve supervision or the federal Bank Holding Company Act, they can have nonfinancial owners.

The FDIC met on Wednesday and extended a freeze on the applications of Wal-Mart and Home Depot to own ILCs. Although the giant retailers say they want to use the ILCs for limited business purposes, some banks fear that retailer-owned financial institutions could take away business.

House Financial Services Committee Chairman Barney Frank introduced legislation earlier this week that would ban retailers from owning ILCs.

Most ILCs are based in Utah, with smaller numbers in California, Colorado, Hawaii, Indiana, Minnesota and Nevada.

ILCs are chartered by states and fall under supervision of the FDIC because the agency provides deposit insurance.

Volkswagen Bank USA owns an ILC that offers home equity lines of credit and credit cards while Target Bank offers proprietary credit cards to businesses, schools and nonprofit groups that shop at Target retail stores.

Other ILCs offer such services as checking and savings accounts, real estate lending, syndicated and bridge financing, and retail financing to support the parent company's retail businesses.


(Parent company in parentheses)

Name Symbol Create or Acquire?

Wal-Mart Bank Create

ComData (Ceridian Corp) Create

DaimlerChrysler Bank US Create

CapitalSource Bank Create

Marlin Business Bank Create

American Pioneer (City Financial) Create

Healthcare Bank (Blue Cross/Blue Shield) Create

Fifth Street Bank (Security Nat'l Master) Create

EnerBank (Home Depot Inc) Acquire


(Ranked by assets)

Name Symbol Assets

Merrill Lynch Bank USA $62 billion

UBS Bank USA $19 billion

American Express Centurion Bank $14 billion

Fremont Investment & Loan $14 billion

Morgan Stanley Bank $11 billion

Source: FDIC



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