Other Worlds

We noticed that Superior Federal Bank is opening a finance company in Roland, Okla., which is about seven miles west of Fort Smith but light-years away from Arkansas’ usury law.

Even the federal Bank Modernization Act doesn’t change the environment that has deprived the finance company industry of oxygen in Arkansas. It only relaxed the usury limit for FDIC-insured institutions.

Superior’s CEO, Stan Bailey, says his thrift will eventually take advantage of Bank Modernization to make some higher interest loans to Arkansas customers previously considered “unbankable.” Meanwhile, he means for Superior Finance Co. to blast off.

“We are starting the business in Oklahoma with the idea of doing some acquisitions of small finance companies,” Bailey says, especially since the prices being paid for finance companies have come back to earth after a few years at stratospheric levels.

He says he’s already talked to some possible takeover targets in Oklahoma and is interested in looking at others “in states contiguous to Arkansas.”