http://dailynews.yahoo.com/h/nm/20011128/bs/financial_providian_dc_3.html The really interesting part of this article is the last paragraph: It [Providian] also agreed to stop marketing and opening accounts for customers in the so-called standard market -- people with good credit histories. Providian has already largely stopped its recent expansion in that market, returning to its core sub-prime market -- customers with patchy or poor credit.
Interesting, Dave! I have a clean credit file--all prime--but still get Providian offers at least once a week. They are for unsecured cards, but with a "go-to" rate of 23.99%, they are clearly sub-prime offers, and they're still rolling in--I got one just yesterday. "Card of the future", my a$$; with a rate like that it has a future in my shredder! Hopefully this will put a stop to the junk mail. Thanks for sharing this!
Re: Providian - Interesting News It Why would regulators want Providian to stick to the sub-prime market? I would think that they would prefer companies to loan money only to those who are good or excellent credit risks. Would one of the Wise care to comment? Doc
Re: Providian - Interesting News It Ah ha! The first news release was a mistake. Here is the text of the corrected release: -------- CORRECTED - Providian in pact with regulators, to sell 2 units In SAN FRANCISCO story headlined, ``Providian in pact with regulators, to sell 2 units,'' please note recast fifth paragraph to read, It also agreed to stop marketing and opening accounts for customers in the so-called standard market -- people with poor credit histories. ... instead of ... It also agreed to stop marketing and opening accounts in the so-called standard market -- people with good credit histories. (Corrects terminology and removes last sentence). A corrected version follows. SAN FRANCISCO, Nov 28 (Reuters) - Struggling credit card firm Providian Financial Corp. (NYSEVN - news) on Wednesday said it plans to sell its credit-card units in Britain and Argentina and has agreed with U.S. regulators to limit its lending as it looks to stabilize its financial situation. The moves come two days after Providian appointed a new chief executive, Joseph Saunders, to help turn around the firm as it struggles with mounting bad loans after a period of rapid growth in the 1990s. Providian said it would look to sell its British and Argentine businesses, which together have about $188 million in deposits and $585 million in receivables. Before any sale, Providian agreed with the British financial regulator, the Financial Services Authority, not to accept new deposit customers or solicit new loan applications in the country. In the United States, Providian agreed with regulators that its subsidiaries will submit three-year capital plans to regulators, limit growth in total assets to no more than 2.5 percent per quarter until the capital plans are approved, and review their loan loss reserves. It also agreed to stop marketing and opening accounts for customers in the so-called standard market -- people with poor credit histories.
Re: Providian - Interesting News It So are they going to keep the same terms but only offer to people with good credit? I can see it now: With your 720 FICO you qualify for 15.9% intro rate with a goto of 23.9%.
Re: Providian - Interesting News It They started improving the offer they send me every two weeks. They finally added a grace period, and made it a gold visa instead of a clear one. Also a 0% intro rate (6 months) with a go to rate of... 23.9% Problem is, with this company even if they gave a 8% APR I wouldn't go near them.
Re: Providian - Interesting News It Easy answer..They make alot more money off of the loans...23.99 to 6.9..Just like in car sales..A difference in profit..As a matter of fact they would be making 3 times as much money than the company offering 6.9 rates...
Re: Providian - Interesting News It That may be, dinob, LOL, but read the corrected press release. The regulators want them to dump the subprime customers in favor of those with good credit. I had a feeling something was screwy about that first news clip -- it just didn't make much sense. Doc
Re: Providian - Interesting News It When a bank sells a portfolio, the average FICO score is a big part of the valuation. That they are limiting their asset growth to 2.5% means that CL increases will be SCARCE. That's $50/quarter on a $2000 CL!!!! The new guy in charge came from Fleet, Household ... he's not a short-timer. I am guessing they're trying to figure out how to stay in this business independently. -mj
Re: Providian - Interesting News It Providian are nothing but scum sucking bottom feeders who pioneered many of the credit practices than many people now find infuriating like "risk based pricing" aka "we can randomly raise your interest rate for any reason or for no reason at all"; the "oops, we mishandled your payment, but you still have to pay a late fee" scam that Cross Country Bank has perfected and First USA excelled at for a while; and telemarketing slam/cram scams whereby if you are unlucky enough to just answer the phone, you will get charged for some useless service no matter how many times, nor how loudly you scream "NO, I'M NOT INTERESTED AND I DON'T WANT THAT!" Even after settling their lawsuits and their 'recovery', they have gotten their come-uppance. Good riddance. PS: Their new guy is from Household and Fleet? Oh, that's going to help alot. Both of those outfits have STELLAR reputations.
Re: Providian - Interesting News It You know, I've never had these problems with them. I pay them on time every month using their free online payments and have never had a shred of trouble. Before the online payments, I allowed plenty of time for my payment to reach them in the mail. Providian in turn gave me a credit card when no one else would touch me (granted they were charging me plenty for the privilege) and as I built a payment history with them they raised my total credit lines by a factor of 25 and lowered my APR 7 points. That's pretty darned good treatment in my book. It could be that I've just been lucky. Anecdotal evidence is not statistically valid be it negative or positive. Don't get me wrong -- I'm glad I have Amex and Citibank in my wallet now. There is no doubt in my mind that I earned the credit hell I'm beginning to pull myself out of and I'm grateful to Providian for taking the chance that they did. I know they were in it for the money and not out of any sense of altruism. Capitalism is a wonderful system. Hopefully another company will eventually step up to the plate so people who are in the same situation I was in will have somewhere to turn.
Re: Providian - Interesting News It I, too have not had a bit of trouble with these people. I applied online in May 99, recd Platinum at 7.99APR. I still have the same APR and a 7000 CL. Always quick and free online payments. When I had a question, CS was friendly and helpful. I have noticed that they have cut out 24 HR customer service as a cost cutting policy. H
Re: Providian - Interesting News It I have to stand up and testify here too. They gave me credit when no one else would. I have never had a minute's problem with them. I do wish they would give prime terms to good customer's who have proved themselves, but I will most likely keep this card unless something drastic happens.
Re: Providian - Interesting News It I have to stand up to - they gave me a card about 2 1/2 years ago. No one else would touch me except JC Penney. Cap one kept denying me and continued flooding my mail box with offers. Providian gave me great credit increases, eventually dropped the apr to 16.9 (which is not great but ...). Because of that chance, I vowed never to be late and finally take care of my credit. They got me started and things are pretty good now. I'm keeping their cards not only because they are my oldest, but also because of some feeling of loyalty (bizarre as it may seem). Anyway ... my 2 cents.
Re: Providian - Interesting News It By the way - crap one finally broke me down. They called on last Saturday offering their gold mastercard. I accepted. I don't know what made me do it! Maybe the "doc" can answer that. For years I've been holding them off. Mainly because they turned me down several times before I was offered the Providian card. Anyway, MCI did the same thing to me. They kept calling me for years. Finally, in a weak moment, I said yes. I couldn't believe it when I got off the phone. Doc, can you explain this phenom??
Re: Providian - Interesting News It I think this proves the old retail adage - "please a customer, and she'll tell a friend. Pi** off a customer, and she'll tell 20." Providian has most definately 'screwed' some folks for whatever reasons. Many others have found them a company that they could do good business with. Mehta's brilliance was to look at the credit landscape and early-on see that "average joe" American consumer had more than enough credit and that the only real opportunity for growth was to go lower in the credit spectrum and try to find "higher risk" customers who would pay. They were successful and grew to #9 largest issuer because of it. The problem is when you go from $0 to $20 billion in receivables, maintaining growth becomes the challenge. So they went up the scale to super-prime, and tried to find "average joe" consumbers who would be profitable (as opposed to rate-surfers, which lose money for the bank). They also went overseas. Guess they just hit the end of their road. My guess is they buy someone to gain scale. My guess is they pick up NextCard for a song (or at an FDIC auction). -mj
Re: Providian - Interesting News It Providian has been good to me. I applied online in July 2000 and got a(Aria a.k.a. Getsmart) $1000 visa $59 annual fee, now it is a $3250 visa with a lowered apr of 16.9% which retention gladly lowered. I also got a Providian Smart Visa this September with a starting line of $1000 and NO ANNUAL FEE(applied online). Not bad after having a bk in 98. Providian has never played games with me and overall has been a good credit card company for me. Funny thing is that my very first Visa back in 92 was a Providian visa $500 limit with a torch on the face of the card. Back then no one would give me a Visa/Mastercard because I had no credit. Only Providian gave me a Visa. Six months later all the good offers bombarded my mailbox and I got rid of Providian because the terms were not the best.
Re: Providian - Interesting News It I'm in there too. They've been just fine to me and gave me a chance after my bk recently. I plan to baby this card, never be late, pay it off, and use it as the "tool" that it is to rebuild a positive tradeline on my credit reports. Does anyone know if their online payments are still free? Were charged ever implemented as in that insert? I always mail my payments anyway, (old habits are hard to break) but I was wondering about that. I'm finally getting with the times I guess as I'm using Orchards online payment now.
Re: Providian - Interesting News It The charge is for the pay by phone service. The online payments are free.
