National Survey: Bankers Concerned about Wal-Mart Entering Banking Arena

Business Wire, Jan 30, 2007

CHICAGO -- Almost three-quarters (70%) of bankers say that the entry of Wal-Mart into the financial services business would be a threat to their banks' business, according to Grant Thornton LLP's 14th Annual Survey of Bank Executives.

Wal-Mart, which applied for federal deposit insurance for a Utah-licensed industrial loan company last year, is already perceived by many bankers as a competitor. Last year alone, Wal-Mart launched its own store-branded Discover[R] card and began to offer discounted money-transfer services in partnership with MoneyGram[R].

Out of those banks surveyed, 76% of banks with less than $500 million in assets, 81% of rural banks and 73% of private banks agree that Wal-Mart's entry into the banking industry would be a threat to their banks' business.

"When it comes to competition, the majority of bankers see Wal-Mart as a menace," says John Ziegelbauer, Grant Thornton's national managing partner of the financial institutions practice.

About the survey

Grant Thornton's Annual Survey of Bank Executives is the oldest continuous independent study of its kind in the banking industry. In October 2006, Grant Thornton mailed questionnaires to a national sample of 4,709 chief executive officers and senior officers of banks and savings institutions with assets in excess of $100 million. A total of 355 completed questionnaires were returned for a response rate of 7.9 percent, yielding a margin of error of O 5.2 percent.

More than two-thirds (67%) of the respondents report assets of less than $500 million, with 33 percent reporting assets greater than $500 million. The executives defined the community they primarily serve as suburban (40%), rural (33%) and/or urban (25%). Almost one-third (29%) are publicly held, 53 percent are private corporations, and 16 percent have mutual charters.

About Grant Thornton

Grant Thornton LLP is the U.S. member firm of Grant Thornton International, one of the leading global accounting, tax and business advisory organizations. Through member firms in more than 110 countries, including 49 offices in the United States, the partners and employees of Grant Thornton member firms provide personalized attention and the highest quality service to public and private clients around the globe. Visit Grant Thornton LLP at www.GrantThornton.com.