NRF: Swipe fees haven’t dropped enough
The National Retail Federation is responding to a report from the Federal Reserve, which revealed that debit card swipe fees collected by the nation’s largest banks have significantly dropped since reform regulations took effect last fall.
The Federal Reserve’s report showed that the average debit card swipe fee charged by large banks covered under last year’s regulations dropped to an average of 24 cents in the fourth quarter of 2011, down from an average of 43 cents in 2009. Debit swipe fees for banks with less than $10 billion in assets, which were not covered by the regulations, remained unchanged as expected.
The NRF, however, said the decrease in swipe fees charged is not enough and expressed disappointment over this result.
"We believe the numbers for the big banks are too high and had the Fed followed the law there would be significantly greater savings for merchants and their customers," NRF SVP and general counsel Mallory Duncan said. "This is working the way the Fed set it up to work, but the Fed didn’t fully comply with what Congress required. This is better than paying the full monopoly prices we paid before but they are still partial monopoly prices."
This is true. In fact,
This is true. In fact, restrictions on swipe fees, or fees banking institutions charge merchants on debit card transactions, have begun to take impact. As a result, interchange fee income has begun to drop at some of the nation's largest banking institutions. Source for this article: Interchange fee revenue plummets for banks.
March pending home sales rise
The Pending Home Sales Index, a forward-looking indicator based on contract signings, rose 4.1% to 101.4 in March from an upwardly revised 97.4 in February and is 12.8% above March 2011 when it was 89.9, according to the National Association of Realtors. The data reflect contracts but not closings.
The index is now at the highest level since April 2010 when it was 111.3.
“First-quarter sales closings were the highest first-quarter sales in five years,” said Lawrence Yun, NAR chief economist. “The latest contract signing activity suggests the second quarter will be equally good.
“The housing market has clearly turned the corner. Rising sales are bringing down inventory and creating much more balanced conditions around the county, which means home prices will be rising in more areas as the year progresses,” he added.
The PHSI in the Northeast slipped 0.8% to 78.2 in March but is 21.1% above March 2011. In the Midwest, the index declined 0.9% to 93.3 but is 16.9% higher than a year ago. Pending home sales in the South rose 5.9% to an index of 114.1 in March and are 10.6% above March 2011. In the West, the index increased 8.7% in March to 108.0 and is 9.0% above a year ago.
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A. O. Smith posts positive Q1
A. O. Smith Corp. has posted first-quarter net earnings of $47.5 million, compared with $24.2 million in the prior-year quarter. Net earnings included an after-tax gain of $16.7 million, related to the sale of shares of Regal Beloit Corporation, which were received from the 2011 divestiture of the electric motor business.
First-quarter sales totaled $468.6 million, up 12% from sales of $417.4 million for the same period last year. The company cited first-quarter contributions from Lochinvar, which was acquired in August 2011, and an 18% increase in sales of A. O. Smith-branded product in China.
“Two highlights in the quarter came from our higher growth businesses,” said Paul Jones, chairman and CEO. “Lochinvar grew more than 10%, and our sales of A. O. Smith-branded products in China continued to grow at a double digit rate.”
Sales of the North America segment, which includes the U.S. and Canada water heater and boiler businesses, increased 10% to $353.3 million from first-quarter 2011 sales of $321.7 million.
Outside of North America, which consists of the China, India and Europe water heating businesses and the water treatment business in Asia, first-quarter sales totaled $124.2 million, up 18% from first quarter 2011 sales of $105.2 million. Higher sales of A. O. Smith branded products in China, driven in part by a pre-buy ahead of an April 2012 price increase, were the primary reason for the sales increase.
During the first quarter, A. O. Smith broke ground for a new 457,000-sq.-ft. water heater plant in Nanjing, China. The new plant will accommodate increased water heater demand as well as growth for new products recently introduced in the China market, including the heat pump, solar and combi boiler.
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