In May of 2009 President Barack Obama signed the Credit Card Accountability,
Responsibility and Disclosure Act into law. This law reduces or eliminates
many of the abusive practices many credit card companies followed.

Locally, only Hancock Bank and Trust and US Bank possess credit card
divisions. Independence Bank sells credit cards at its branches, but does so
as a second party for credit card companies.  After viewing the provisions
of the act, local U.S. Bank Branch Manager Vanessa Payne and Larry B. Ramey,
President and Chief Financial Officer of Hancock Bank, praised the law.

"Overall, I think there are some abuses that need to be reined in," Ramey
said. "It goes back to being a responsible banker."

Payne offered similar sentiments.

"I think it is just tweaking terms and conditions slightly," she said.

Both doubted the new requirements in the law meant dramatic changes in their
respective credit card business. Payne and Ramey said their respective
institutions followed responsible lending practices when offering credit to
customers.

In brief, the act prohibits some of the most egregious abuses committed by
credit card companies. The law prevents credit card companies from raising a
customer's interest rate unless the customer falls 60 days or more behind in
payments. This provision does not apply to credit accounts with a variable
rate.

The act prevents credit card companies from charging over limit fees unless
the customer agrees to allow the company to authorize purchases placing the
customer over the card limit. The law allows a customer to opt in or out of
this provision at any time he or she wants.

Another provision requires credit card companies to mail statements to
customers at least 21 days before the due date, and the law requires card
companies to implement a fixed due date to a card that remains unchanged
from month-to-month.

Ramey said as a community bank, it did not follow the practices this law
intends to fix. He said Hancock Bank started offering credit cards to
customers in 1996, and continues to charge the same rate today as it did in
1996.

In regards to the over-limit fee, Ramey said Hancock Bank does not charge
this fee. He said the company does charge a late fee, but only $5.

"I don't think we've ever done anything to abuse the customer," Ramey said.

"People that use credit need to do so responsibly, and people who offer
credit need to do that responsibly. I feel we have always done that."

Payne said US Bank exceeds the requirements of the law in regards to raising
a customer's interest rate. She said the company does not plan to raise a
customer's interest rate just because he or she falls 60 days behind. She
said other factors come into play which raise the rate.

The fixed due date provision pleased Payne. In the past, many credit card
companies varied the due date from month-to-month, and many customers
incurred late payment fees due to this practice.

"I think this is good," Payne said. "It will help customers avoid late
fees."

Another provision of the act changes how credit card companies apply
payments in excess of the minimum. Most credit card companies charge
different rates on a card. The interest rate on a cash advance from a credit
card differs from the interest rate on a purchase.

In the past, credit card companies applied payments in excess of the minimum
to the lowest rate on the card, letting the interest on the higher rate
accrue over time. The act mandates that any payment over the minimum goes
toward the highest rate first.

"That's my favorite provision," Payne said.

Ramey said this provision does not affect customers with Hancock Bank and
Trust credit cards. He said the bank always charged the same interest rate
for cash advances and purchases.

"We have one rate for what the customer's balance is," he said.

Marketing cards to people under 21 also changes dramatically under this act.

Persons under age 21 need to obtain a credit worthy person as a co-signer,
who assumes joint liability for the debt, or provide financial information
proving their credit worthiness. The law also prevents credit card companies
from increasing the debt limit on the card unless the cosigner agrees to the
increase in writing.

Ramey and Payne both liked the changes to persons under the age of 21.

"I am glad that rule changed," Ramey said. "We never did anything like that.
We always made sure they could make the payments."

The act also requires changes in statements mailed to customers. The law
mandates that statements show how long it takes to pay off a credit card at
the minimum payment, assuming no further charges to the account. It also
stipulates the statement show a payment figure for paying off the card in 36
months.

"There are a lot of new disclosures and a lot of new information that should
be given," Ramey said. "I do not have a problem with that."

The new law provides credit card customers with information and protections
that help them to use credit cards more responsibly, Payne said.

"It all boils down to managing your personal finances," Payne said. "It
means knowing the terms and conditions of the products a person takes on,
and using them within those guidelines to avoid charges."