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BanxQuote.com is a bank rate aggregator that provides personal finance and enterprise benchmarking solutions featuring dynamically updated daily market rates on banking, mortgage and loan products from financial institutions in all fifty states and Washington, DC.
The firm's BanxQuote Rx division offers financial restructuring services to private and public companies nationwide that are facing mounting debt obligations or cash flow problems, and may be unaware of their strategic options. The firm specializes in reducing and restructuring various categories of business debt, restoring or improving liquidity within the shortest possible time frame.
Overview & History
BanxQuote was established by its parent BanxCorp in 1984. It features side-by-side rates on money market accounts, savings and jumbo certificates of deposit (CDs), mortgage loans, home equity and auto loans for various terms and amounts.
BanxQuote also provides proprietary state-by-state, regional, and national composite benchmarks and indices for its various banking, mortgage and lending products. Clients of the firm have included hundreds of financial institutions nationwide and its indexes are frequently used as a trusted source and performance benchmark by public policymakers, government agencies, GSEs (Freddie Mac), pension funds, foundations, religious organizations, major banks and brands.
Evolution of the Banking Industry and Online Banking
Because of a historic national concern about concentration of power, the
U.S. banking industry always had more independent banking institutions than most
other countries. Regulatory intervention increased during the Great Depression, but the
zeal for government oversight began eroding in the 1980s and 1990s, on the grounds
that market discipline could achieve the same efficiency ends as regulation, without
inhibiting innovation.
Consequently, Congress passed the Depository Institution Deregulation
and Monetary Control Act of 1980 which phased out Federal Reserve Regulation Q
deposit interest rate ceilings, raised FDIC deposit insurance coverage to $100,000,
authorized savings and loans to make consumer loans, pre-empted state usury laws
limiting rates that lenders could charge on residential mortgage loans, and authorized
state chartered banks to offer the same loan rates as national banks.
The Garn-St Germain Depository Institutions Act of 1982 deregulated the
Savings and Loan industry.
Moreover, during those two decades the banking industry changed from
having extensive geographic limitations to being characterized by interstate banking
and branching. As a result of the Interstate Banking and Branching Efficiency Act of
1994, the deregulation of intrastate and interstate banking and branching activities
played a major role in the changing structure of the U.S. banking industry.
Evolution of BanxQuote and the Bank Rate Market
In 1984, after the U.S. banking industry and interest rates were deregulated, and at about the same time as the British Bankers Association recognized the need to bring a measure of uniformity to the London Interbank market by introducing the fixing of BBA Interest Settlement rates, the predecessor of BBA LIBOR, BanxQuote began aggregating and publishing bank rate tables and indices for a series of banking, mortgage and loan products throughout the United States.
BanxQuote started compiling rates from financial institutions on a daily, weekly and monthly rotating schedule, inputting the rates into computers programmed to order, array, update and display the information. BanxQuote initially generated revenues by selling newsletter subscriptions, through paid access to a dial-up bulletin board system and by charging data licensing fees to print media, particularly The Wall Street Journal, which published BanxQuote rate tables on an ongoing basis for nearly two decades. BanxQuote also started publishing its rates on Reuters professional market terminals worldwide.
From 1986 until 1995 when it launched its Internet operations, BanxQuote also operated a national call-center in partnership with various fixed income securities broker-dealers, maintaining an active physical presence at the brokerage firms' trading floors.
The BanxQuote.com website was launched at a BanxQuote National Banking & Media Conference held at Salomon Brothers in New York, on April 7, 1995. The conference and multi-media event organized by BanxQuote featured a series of forward-thinking roundtable discussions moderated by senior executives and editors of Bloomberg, Business Week, Dow Jones Telerate, Fortune, Knight-Ridder Financial, Reuters and Worth, with the participation of several Ivy League universities, government officials and top financial industry executives from ADP, American Express, Chemical Bank, Citicorp, Dean Witter Discover, EDS, Ernst & Young, Office of the Comptroller of the Currency, FDIC, Federal Reserve Board, Fidelity Investments, Goldman Sachs, Intuit, KPMG, LaSalle National Bank, MBNA, Mellon Bank, M&T Bank, Oppenheimer & Co., PaineWebber, Prudential Bank, Republic National Bank, Safra National Bank, State Bank of India, and many others.
The Internet Changes the Landscape of the Bank Rate Market
Starting in the mid-1990s, the Internet emerged as an extremely powerful
and popular medium, enabling a growing number of consumers to access financial
information and execute banking and financial transactions online.
By 2007, online banking became the most powerful retail banking channel
ever deployed. According to the research firm TowerGroup, online banking is
increasing in use at an annual rate of 27%, outpacing everything from ATMs to call
centers. With ATMs and financial institution branches showing signs of flattening
transaction volume, TowerGroup believes that the Internet presents the future of bank
delivery.
Role of Bank Rate Aggregators
Bank rate aggregators such as BanxQuote provide greater efficiency and transparency to the market by reducing the time and effort required by in-market consumers across the country who would otherwise need to regularly call and check numerous banking and mortgage service centers and websites for interest rate quotes and updates, creating a centralized gateway for easy side-by-side review and comparison, as well as a centralized transaction facility.
Competition & Antitrust
In 2007, BanxCorp filed a federal antitrust complaint against its competitor Bankrate Inc. In particular, the complaint alleges that Bankrate has engaged in predatory pricing, vendor lock-in, exclusive dealing and other exclusionary product and distribution bundling and tie-in arrangements. These actions, according to the complaint, have suppressed competition by foreclosing principal distribution gateways available to competitors in the bank rate aggregation market.
Copyright © 2008 BanxCorp.
Permission is granted to copy, distribute and/or modify this document under the terms of the GNU Free Documentation License, Version 1.2 or any later version published by the Free Software Foundation; with no Invariant Sections, no Front-Cover Texts, and no Back-Cover Texts. A copy of the license is included in the section entitled "GNU Free Documentation License". |
