Receiving Wide Coverage ...
Banished: The U.K.'s Financial Services Authority has banned former head of corporate lending at HBOS Peter Cummings from working in the country's financial services industry for his role in the bank's collapse during the 2008 financial crisis. Cummings was also fined £500,000 ($805,000), which the Journal notes is "the highest fine imposed by the FSA on a senior executive for management failings." The FSA imposed the penalties because it believes Cummings "pursued an aggressive expansion of HBOS's lending practices, which led to major losses," the Times reports. HBOS was ultimately purchased by Lloyds TBS as a part of a rescue takeover in 2008 and the merged banks received a big bailout from the British government shortly thereafter.
The FT reports Cummings is likely to be the only British banking executive to face fines related to the 2008 financial crisis as the FSA has concluded other investigations without filing charges. Cummings himself was surprised to be singled out, telling the paper, "The fact that I am the only individual from HBOS to face investigation defies comprehension." While he rejects the decision completely, Cummings says he has no plans to appeal in order to spare his family additional costs and strain.
The JPMorgan Shuffle: Just a little over a month after an executive shake-up that saw now co-chief operating officer Matt Zames rise in power, JPMorgan Chase is overhauling its corporate and investment banking division. Equity division head Carlos Hernandez will oversee a new unit called investor services, which includes prime brokerage services for the bank's hedge fund clients. Tim Throsby will now oversee all of the investment bank's equities division. Another "winner" in this shake-up, according to the Times, is Blythe Masters, the long-time head of JPMorgan's commodities division, who will take on regulatory affairs for the corporate and investment bank. A source close to the bank told the Journal that unlike previous shake-ups, its latest reshuffle is not a result of mounting wrong-way derivatives trading losses.
Wall Street Journal
European banks are maintaining business ties with Iran, according to regulatory filings obtained by the paper. While these ties don't appear to be violating any sanctions, some banking experts suggest "the banks are risking embarrassment or regulatory problems in the U.S. as it scrutinizes financial transactions with sanctioned countries."
It looks like the Securities and Exchange Commission's case against the Reserve Primary money-market mutual fund — which "broke the buck" in 2008 when it fell below the $1-a-share price money-market funds look to maintain — may actually go to trial. The case is slated to start on Oct. 1 and, though attempts have been made by both sides, a settlement does not appear imminent.
Financial Times
The head of HSBC's U.K. bank, Joe Garner, has quit, telling the paper he was supposed to move abroad, but, instead, prefers to say in the U.K. with his family. Garner will be replaced by Antonio Simoes, the Portuguese head of its European retail business, in November.
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