Money Talk: UA Hires Publicly Traded Firm To Handle Financial Aid Disbursements, Refunds

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UA HIRES PUBLICLY TRADED FIRM TO HANDLE FINANCIAL AID DISBURSEMENTS, REFUNDS
The University of Arkansas has joined a growing list of college and universities to hire publicly traded Higher One to handle its financial aid disbursements and refunds to students at some of the system’s six campuses across the state.

Higher One Holdings Inc., which reported revenues of nearly $229 million in fiscal 2014, has marketing pacts with more than 1,900 colleges across the U.S. to provide checking accounts or prepaid cards to students to conduct routine financial transactions and to receive financial aid disbursements.

According to the Center for Responsible Lending (CRL), in return for allowing financial institutions to offer these accounts to students, schools may receive a share of the revenue or in-kind benefits, such as assistance with federal financial aid disbursement.

“Such arrangements are lucrative to financial institutions not only because of the fee income and exclusivity, but because they are a very effective pipeline to new customers,” said a recent CRL research paper. “Once a consumer chooses a bank, they are unlikely to switch, and reaching college students allows banks to attract a new, likely long-term, customer base.”

The CRL warns that the financial benefits schools derive from these agreements “may serve to misalign incentives between the schools and their students.” Yet, Higher One counters with its own recent survey, saying that college students are becoming less financially responsible.

“Students reported feeling least prepared for the financial aspects of college, even as student loan debts continue to grow at an alarming rate,” said Mary Johnson, vice president of financial literacy and student aid policy at Higher One. “The results suggest we must start financial literacy education before students enter college and continue to teach its importance throughout a student’s college career — it is imperative that students know the impact student loan debt can have later in life.”

To see the CRL report, click here. To see the Higher One-sponsored “Monday Matters on Campus” survey, click here.

DEADLINE NEARS FOR FARMERS TO CHOOSE FINANCIAL SAFETY NET
Arkansas farm owners and producers have until Tuesday (April 7) to choose between Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC), the safety-net programs established by the 2014 Farm Bill.

“This is an important decision for producers because these programs help farmers and ranchers protect their operations from unexpected changes in the marketplace,” said federal Agriculture Secretary Tom Vilsack. “Nearly 98% of owners have already updated their yield and base acres, and 90% of producers have enrolled in ARC or PLC. These numbers are strong, and continue to rise.”

If no changes are made to yield history or base acres by the deadline, the farm’s current yield and base acres will be used. If a program choice of ARC or PLC is not made, there will be no 2014 crop year payments for the farm and the farm will default to PLC coverage for the 2015 through 2018 crop years. Producers who have an appointment at their local FSA offices scheduled by April 7 will be able to make an election between ARC and PLC, even if their actual appointment is after the deadline.

Covered commodities under ARC and PLC include barley, canola, large and small chickpeas, corn, crambe, flaxseed, grain sorghum, lentils, mustard seed, oats, peanuts, dry peas, rapeseed, long grain rice, medium grain rice (which includes short grain and sweet rice), safflower seed, sesame, soybeans, sunflower seed and wheat. Upland cotton is no longer a covered commodity.

Producers need to contact the Farm Service Agency by April 7. To learn more, farmers can contact their local Farm Service Agency county office. To find local offices, visit here.

HOME BANCSHARES BUYS $289 MILLION IN LOANS, OPENING NEW YORK OFFICE
Home BancShares, Inc., parent company of Centennial Bank, announced it has completed an acquisition of national commercial real estate loans from J.C. Flowers & Co. LLC totaling approximately $289.1 million. The pool of loans was originated within the former Doral Property Finance portfolio and will now be housed in a division of Centennial known as the Centennial Commercial Finance Group (CFG). The Conway-based financial institution also said it would open a New York loan production office.

FNB PARAGOULD SEEKS DIVERSIFICATION WITH NW ARKANSAS INVESTMENT
The bank concentration in Benton and Washington counties is one of the highest in the nation, with 180 branches operated by 31 different banks in the growing region of 500,000 residents. Contrast that with 35 banks running 180 branches in the Little Rock metro area with a population of around 902,000.

Thick concentration and hyper competition in the local financial sector has not deterred bankers like Donald Guinn, president of First National Bank Paragould, from making an estimated $15 million investment in the region. Read why this Northeast Arkansas business leader is ramping up in the opposite corner of the state at this link.

SIMMONS FIRST NATIONAL CORP. APPOINTS THREE TO BOARD
Pine Bluff-based Simmons First National Corp. announced the appointments of Mark Doramus, Christopher “Chris” Kirkland and Joseph “Joe” Porter to its Board of Directors.

Doramus is Chief Financial Officer of Little Rock-based Stephens Inc.; Kirkland serves as Principal of Anchor Investments, a Nashville, Tennessee-based real estate investment company; and Porter is President of Akin Porter Produce, Inc., a leading distributor of fresh wholesale produce based in Greenfield, Tennessee.