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Sunday April 4, 2010
Business: Pam Haynes
UNUSUAL DWELLING: Couple find new use for old tires. 2C
PHaynes@hpe.com (336) 888-3617
IN THE SPOTLIGHT
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New law will force Chase to cut customers NEW YORK (AP) — JPMorgan Chase & Co. expects its credit card income to drop by up to $750 million because of recent regulations — and a lot of customers will get cut off as a result. In his annual letter to shareholders last week, CEO Jamie Dimon said the New York-based bank expects a $500 million to $750 million hit from the credit card reforms that took effect Feb. 22 prohib-
iting what he referred to as “certain practices that were not considered consumer-friendly.” The law bans moves such as changing interest rates on existing balances, and charging over-the-limit fees without customer permission. “We believe that many, but not all, of the changes made were completely appropriate,” Dimon wrote. He noted that before the law was enacted, Chase
eliminated some of the now-illegal practices, like universal default, where card rates would rise if a payment on an unrelated bill was late. However, the law’s prohibition on existing balance rate hikes, and the provision that requires all payments be applied to the highest interest rate balances, prompted a response. The bank reduced credit lines and canceled cards customers hadn’t used for an extended period, for instance. Chase also sharply cut the number of offers featuring low introductory rates and promotional
rate balance transfers, which alone reduced outstanding balances by $20 billion, Dimon said. The bank also will no longer offer cards to 15 percent of its current customers. “This is mostly because we deem them too risky in light of new regulations restricting our ability to make adjustments over time as the client’s risk profile changes,” Dimon wrote. Future growth in Chase’s credit card business will depend on product innovation, Dimon said. He pointed to recent introductions, like its Sapphire card for afflu-
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ent consumers and its Ultimate Rewards program as examples, along with Blueprint, Chase’s online program for card customers to manage their spending and borrowing. “By all measures, 2009 was a terrible year for our credit card business,” Dimon wrote. Charge-off rates, the amount of card debt the company had to write off as uncollectible, reached 8.5 percent, an all-time high. But while poor, that performance was better than competitors, he said. The bank’s card services division posted a net loss of $2.2 billion for the year, compared with a $780 million profit in 2008.
BUSINESS PROFILE
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Are you an entrepreneur with an established business in the High Point area? If so, you may be a candidate for a Business Profile. We profile selected businesses every Sunday. If you’re interested, submit your name, number and brief explanation of your company to jfeeney@hpe. com.
SMART PRICING
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Restaurant owner lives American dream BY PAM HAYNES ENTERPRISE STAFF WRITER
HIGH POINT - Nick Vakakis is an example of the American dream you often read about or see in movies. Hailing from Samos, Greece, Vakakis came to the United States 40 years ago because he wanted something of his own. That some-
‘America is a country where if anyone puts themselves into something, they will find success. I can say that’s really true.’
AT A GLANCE
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Name: Nick Vakakis Occupation: Owner of Rainbow Restaurant Hometown: Samos, Greece Age: 55 Favorite place to travel: Back to Greece to see friends, family Favorite music: 60s and 70s Business advice: “This is the country where you can do most anything. If you open a business, stick with it, put your mind to it and give it 1,000 percent.”
“I would pick up phrases, then I would pick up words from some of the menus,” he said. “I was afraid sometimes, coming to a new place where I thing - Rainbow Family didn’t know nobody.” Like the American Restaurant - has been a dream story, Vakakis staple in High Point’s worked his way up in dining scene for 30 the business, advancyears now. ing from a dishwasher “When you make a move like this to anoth- to a cook in the kitcher country, you want to en. Even then, before he had a firm grasp on do something,” Vakathe English language, kis said. “If I wanted sometimes he said he to just stay and work would have to taste a a regular job, I would seasoning or a spice to have stayed there (in find the right ingrediGreece).” ents for a dish because He arrived in the he couldn’t read the U.S. at the ripe age of labels. 15 with his uncle and Ten years later, his father, but withafter marrying, saving out any knowledge of money, learning the the English language. language and learnInstead of going to school, he picked up on ing every facet of the restaurant industry, the language through interaction with fellow he took another big workers at his first job chance and opened his first restaurant. in High Point, where “I didn’t know if I he worked as a dishwasher in a restaurant. was going to make it
Nick Vakakis Owner
DON DAVIS JR. | HPE
Nick Vakakis operates the Rainbow Grill. back then,” he said about his first days in business. Even coming up with a name for the restaurant seemed to be a challenge, until one day, it almost seemed to fall out of the sky. “My wife and I had just come out of the North State Communications building where we had been trying to come up with a name for our restaurant that wasn’t already taken
in the phone book,” Vakakis said. “We had looked and looked. On the third or fourth day of looking, I said, ‘Come on, let’s just go.’ When we walked outside, it had been raining and there was a beautiful rainbow in the sky.” The name Rainbow Family Restaurant was set, also because his menu encompasses “a rainbow of food,” he said. The only other
YOUR COMMUNITY. YOUR NEWSPAPER.
ingredients needed to make his business successful were the things he had learned from working in various restaurants and hard, persistent work, he said. “America is a country where if anyone puts themselves into something, they will find success,” he said. “I can say that’s really true.” phaynes@hpe.com | 888-3617
SAN FRANCISCO (AP) — Verizon Wireless is cutting the prices for Palm’s Pre Plus and Pixi Plus smart phones and offering free access to a Wi-Fi service that lets the phones deliver Internet access to other kinds of devices — such as Apple’s iPad. Palm Inc. has been struggling to compete as consumers flock to such devices as Apple Inc.’s iPhone and Research In Motion Ltd.’s BlackBerry, so the price cut and addition of some free service could help the company snag bargain-hunting shoppers. Verizon spokeswoman Brenda Raney said Thursday that Verizon is selling Palm’s Pre Plus for $50, down from $150. The Pixi Plus now goes for $30, down from $80. Both require twoyear contracts. Both phones are black with touch screens and standard QWERTY keyboards. The keyboard for the Pre Plus slides out from the bottom, while the one for the Pixi Plus is built into its face. The devices run Palm’s WebOS software. Verizon is also offering free — though limited — use of a service that lets up to five devices connect to Verizon’s wireless network through the phones, which act as a Wi-Fi hotspot.
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