New Privacy Study From Bankers Systems Finds Nearly 70 Percent of Banks And Savings Associations Will Not Share Customer Information

Credit Unions And Finance Companies Are More Likely to Share Customer

Information With Nonaffiliated Third Parties



Apr 23, 2001, 01:00 ET from Bankers Systems, Inc.

    ST. CLOUD, Minn., April 23 /PRNewswire Interactive Press Release/ -- When
 the consumer privacy deadline rolls around in July, credit unions will be
 nearly twice as likely to share customer information than banks and savings
 associations, according to Bankers Systems' recent study of the sharing
 practices of over 3,900 financial institutions.
     The study, which included banks, savings associations, credit unions, and
 finance companies, found that the majority of banks and thrift institutions
 (68.8 percent) indicated they would not be sharing customer information with
 nonaffiliated third parties outside of the exceptions.
     On the opposite end of the spectrum, 65.4 percent of the credit unions
 sampled said they will be sharing nonpublic personal information about their
 members in ways that will warrant a disclosure and opt-out rights.  Credit
 unions that will share the information said they do so in the best interest of
 their members because it will result in opportunities for additional services
 of value for them.
     Finance companies also showed a greater propensity to share.  More than
 half (51.9 percent) indicated they will disclose that they share, or reserve
 the right to share, their customers' information with nonaffiliated third
 parties.
 
     Asset Size and Location Play a Role
     Asset size appears to play a role in the decision of whether or not to
 share customer information.  Bankers Systems' analysis shows that the largest
 institutions are far more likely to engage in third-party information sharing
 than smaller institutions.  For example, 63.5 percent of banks and savings
 institutions with over $1 billion in assets plan to disclose that they share,
 or plan to share, customer information with nonaffiliated third parties
 outside the exceptions.  Conversely, only 30 percent of banks and savings
 institutions with under $1 billion in assets plan to disclose that they will
 share the customer information.
     State by state comparisons also yielded some distinguishing data.  In
 Colorado, Vermont, Mississippi, Montana, North Dakota, Oklahoma, and Illinois,
 nonsharing institutions outnumber their sharing counterparts by a margin of
 more than three to one.  In contrast, two states were found to have an
 overwhelming majority of sharing institutions.  In Michigan, 71.7 percent of
 the institutions studied plan to share customer data, and in Utah, 69 percent
 intend to do so.
 
     Ready ... Or Not?
     Bankers Systems' study also found that nonsharing institutions are more
 likely to provide their notices well in advance of the compliance deadline.
 This can be attributed, in part, to the fact that their compliance
 requirements allow for shorter, simpler notices, which can be finished more
 quickly.  Institutions with more complex notices that include opt-out language
 are less likely to have their notices completed and mailed early.
     In addition to the study on sharing practices, Bankers Systems has been
 conducting a survey through its privacy portal --
 http://www.PrivacyHeadquarters.com -- to determine just how prepared
 institutions are to meet the privacy disclosure deadline in July.  With over
 500 financial institutions responding so far, the results are as follows:
     -- 9 percent of the institutions have already sent out their privacy
        notices,
     -- 28 percent have their privacy policies drafted and printed,
     -- 52 percent are in the process of developing their privacy policies and
        notices, and
     -- 11 percent have just begun to study the requirements.
 
     According to Bankers Systems' attorney Katie Iverson, these numbers are
 not surprising.  "Banks, credit unions, and thrift institutions are used to
 this type of major regulation.  For them, it's a normal part of doing
 business.  As a result, they began preparing early, and for the most part are
 in good shape to meet the financial privacy deadlines in the
 Gramm-Leach-Bliley (GLB) Act," said Iverson.
     "On the other hand, some organizations that will be impacted by GLB, such
 as automobile dealers and insurance companies, are more retail-oriented and
 are not accustomed to this type of regulation," said Iverson.  "They may not
 understand the magnitude of the research, analysis, and decision making that
 is required in order to accurately develop and disclose their privacy
 policies.  Many of these organizations are not far along in this process, and
 many of them will be scrambling before July."
     Bankers Systems is the leading national provider of compliance resources
 solutions, including documents, disclosures, software, training and services.
 The company offers a full range of products and services to help financial
 institutions deal with the privacy provisions of the Gramm-Leach-Bliley Act.
 Bankers Systems' privacy products include tailored disclosures in various
 mediums (paper, electronic, or web); training tools; PrivacyStateWise internet
 tool for managing state-specific financial privacy issues in the banking,
 insurance, and mortgage industries; and PrivacyHeadquarters.com, the heavily
 visited portal dedicated solely to providing comprehensive privacy information
 for banking, insurance, securities, and mortgage professionals at no charge.
 
     About Bankers Systems
     Bankers Systems, Inc., a CCH INCORPORATED company, is a leading national
 provider of compliance resource solutions for financial institutions and their
 legal counsel.  The company's deposit, lending, and retirement plan documents,
 disclosures, software, training, and support services are used by more than
 12,000 financial institutions, including 83 percent of banks in the U.S.  In
 addition, over 60 leading core processors and systems integrators use Bankers
 Systems' compliance-related documents and other components in their solutions.
 For more information, call 800-552-9410 or visit http://www.bankerssystems.com
 
     Bankers Systems Inc. is a registered trademark of Bankers Systems, Inc.
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X33117873
 
 

SOURCE Bankers Systems, Inc.
    ST. CLOUD, Minn., April 23 /PRNewswire Interactive Press Release/ -- When
 the consumer privacy deadline rolls around in July, credit unions will be
 nearly twice as likely to share customer information than banks and savings
 associations, according to Bankers Systems' recent study of the sharing
 practices of over 3,900 financial institutions.
     The study, which included banks, savings associations, credit unions, and
 finance companies, found that the majority of banks and thrift institutions
 (68.8 percent) indicated they would not be sharing customer information with
 nonaffiliated third parties outside of the exceptions.
     On the opposite end of the spectrum, 65.4 percent of the credit unions
 sampled said they will be sharing nonpublic personal information about their
 members in ways that will warrant a disclosure and opt-out rights.  Credit
 unions that will share the information said they do so in the best interest of
 their members because it will result in opportunities for additional services
 of value for them.
     Finance companies also showed a greater propensity to share.  More than
 half (51.9 percent) indicated they will disclose that they share, or reserve
 the right to share, their customers' information with nonaffiliated third
 parties.
 
     Asset Size and Location Play a Role
     Asset size appears to play a role in the decision of whether or not to
 share customer information.  Bankers Systems' analysis shows that the largest
 institutions are far more likely to engage in third-party information sharing
 than smaller institutions.  For example, 63.5 percent of banks and savings
 institutions with over $1 billion in assets plan to disclose that they share,
 or plan to share, customer information with nonaffiliated third parties
 outside the exceptions.  Conversely, only 30 percent of banks and savings
 institutions with under $1 billion in assets plan to disclose that they will
 share the customer information.
     State by state comparisons also yielded some distinguishing data.  In
 Colorado, Vermont, Mississippi, Montana, North Dakota, Oklahoma, and Illinois,
 nonsharing institutions outnumber their sharing counterparts by a margin of
 more than three to one.  In contrast, two states were found to have an
 overwhelming majority of sharing institutions.  In Michigan, 71.7 percent of
 the institutions studied plan to share customer data, and in Utah, 69 percent
 intend to do so.
 
     Ready ... Or Not?
     Bankers Systems' study also found that nonsharing institutions are more
 likely to provide their notices well in advance of the compliance deadline.
 This can be attributed, in part, to the fact that their compliance
 requirements allow for shorter, simpler notices, which can be finished more
 quickly.  Institutions with more complex notices that include opt-out language
 are less likely to have their notices completed and mailed early.
     In addition to the study on sharing practices, Bankers Systems has been
 conducting a survey through its privacy portal --
 http://www.PrivacyHeadquarters.com -- to determine just how prepared
 institutions are to meet the privacy disclosure deadline in July.  With over
 500 financial institutions responding so far, the results are as follows:
     -- 9 percent of the institutions have already sent out their privacy
        notices,
     -- 28 percent have their privacy policies drafted and printed,
     -- 52 percent are in the process of developing their privacy policies and
        notices, and
     -- 11 percent have just begun to study the requirements.
 
     According to Bankers Systems' attorney Katie Iverson, these numbers are
 not surprising.  "Banks, credit unions, and thrift institutions are used to
 this type of major regulation.  For them, it's a normal part of doing
 business.  As a result, they began preparing early, and for the most part are
 in good shape to meet the financial privacy deadlines in the
 Gramm-Leach-Bliley (GLB) Act," said Iverson.
     "On the other hand, some organizations that will be impacted by GLB, such
 as automobile dealers and insurance companies, are more retail-oriented and
 are not accustomed to this type of regulation," said Iverson.  "They may not
 understand the magnitude of the research, analysis, and decision making that
 is required in order to accurately develop and disclose their privacy
 policies.  Many of these organizations are not far along in this process, and
 many of them will be scrambling before July."
     Bankers Systems is the leading national provider of compliance resources
 solutions, including documents, disclosures, software, training and services.
 The company offers a full range of products and services to help financial
 institutions deal with the privacy provisions of the Gramm-Leach-Bliley Act.
 Bankers Systems' privacy products include tailored disclosures in various
 mediums (paper, electronic, or web); training tools; PrivacyStateWise internet
 tool for managing state-specific financial privacy issues in the banking,
 insurance, and mortgage industries; and PrivacyHeadquarters.com, the heavily
 visited portal dedicated solely to providing comprehensive privacy information
 for banking, insurance, securities, and mortgage professionals at no charge.
 
     About Bankers Systems
     Bankers Systems, Inc., a CCH INCORPORATED company, is a leading national
 provider of compliance resource solutions for financial institutions and their
 legal counsel.  The company's deposit, lending, and retirement plan documents,
 disclosures, software, training, and support services are used by more than
 12,000 financial institutions, including 83 percent of banks in the U.S.  In
 addition, over 60 leading core processors and systems integrators use Bankers
 Systems' compliance-related documents and other components in their solutions.
 For more information, call 800-552-9410 or visit http://www.bankerssystems.com
 
     Bankers Systems Inc. is a registered trademark of Bankers Systems, Inc.
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X33117873
 
 SOURCE  Bankers Systems, Inc.