Receiving Wide Coverage ... Canadian Invasion: The Wall Street Journal, Financial Times and Reuters (via the New York Times) all take a closer look at Royal Bank of Canada's decision to acquire City National in Los Angeles. RBC may have stubbed its toe in its previous American incursion with RBC Centura (which it later sold to PNC), but City National is a different play. The California bank has a big presence in wealth management, particularly managing
Breaking News This Morning ... Earnings: KeyCorp, Huntington, BB&T, BankUnited Receiving Wide Coverage ... European QE: The European Central Bank is expected to launch a quantitative-easing program that could include the purchase of about 50 billion euros worth of bonds each month (equivalent to about $58 billion). Europe hasn't embarked on a QE program during the recent years of economic tumult. But the state of the continent's fragile economy prompted the move, said Matteo Renzi, Italy's prime minister.
Breaking News This Morning ... Earnings: Fifth Third, U.S. Bancorp Receiving Wide Coverage ... SOTU from POTUS: Banking and finance played a lead role in President Obama's State of the Union address on Tuesday night. For one, Obama vowed to keep Dodd-Frank intact, saying the law's rules and the creation of the Consumer Financial Protection Bureau are protecting American consumers. However, Obama avoided direct bashing of banks, declining to take up the same rhetoric as Sen. Elizabeth Warren,
Breaking News This Morning ... Earnings: Regions Wall Street Journal The Journal notes the divergent paths down which the U.S. and European central banks appear to be heading. The Federal Reserve, on the one hand, still appears ready to raise short-term rates, sometime, perhaps, around the middle of this year. The European Central Bank, on the other hand, looks set to engage in a round of quantitative easing, in which it will purchase hundreds of billions of euros
Editor's note: Morning Scan will not publish on Monday, Jan. 19 in observance of the Dr. Martin Luther King Day holiday. We'll be back on Tuesday, Jan. 20. Breaking News This Morning ... Earnings: SunTrust, Comerica, PNC Receiving Wide Coverage ... Earnings Postmortem: Bank of America and Citigroup each produced disappointing fourth-quarter results as trading revenue went south and low interest rates curbed potential profits. Taken together with JPMorgan's less-than-stellar earnings, these results suggest the fate of the biggest
Breaking News This Morning ... Earnings: Citigroup, Bank of America Receiving Wide Coverage ... Dimon Says Bigger Is Better: With so much chatter about a JPMorgan Chase breakup these days, one wonders if the megabank could eventually be forced to downsize out of pure conversational momentum. JPMorgan head Jamie Dimon spent fourth-quarter earnings calls Wednesday defending his bank's behemoth status. "The synergies are huge, both expense and revenue," Dimon said. "The unscrambling would be extraordinarily complex." Dimon also
Breaking News This Morning ... Earnings: JPMorgan, Wells Fargo Receiving Wide Coverage ... See You in Court: Is MetLife brave or foolish for going to battle over its designation as a systemically important financial institution? Opinions are split on the matter. In the pro camp, an unsigned op-ed in the Wall Street Journal calls MetLife's decision to sue the U.S. government "the best news taxpayers have had since the financial crisis." The article argues the Financial Stability Oversight
Receiving Wide Coverage ... Game On: MetLife is suing the U.S. government for designating it as a systemically important financial institution. The life insurer plans to file a lawsuit in the United States District Court for the District of Columbia Tuesday. MetLife is the first firm to try to shake off the systemically important label by going to court, the New York Times reports. An article in the Wall Street Journal sheds light on why company
Receiving Wide Coverage ... Low Energy: The fizzling energy market will get a lot of attention this earnings season as nervous shareholders question banks about their exposure, according to the New York Times. The paper suggests banks gird themselves for defaults in the wake of falling oil prices. On the upside, Wells Fargo chief John Stumpf says lower oil prices are a boon for consumer lending: people who spend less at the gas pump will have
Receiving Wide Coverage ... Her Own Woman: Banco Santander executive chairman Ana Botín is building a reputation as a woman of action. The Spanish bank has raised $8.8 billion in capital and plans to cut dividends. Analysts say these are practical moves that will make the bank safer in the long run; they also note that the decisions underscore Botín's willingness to upend family tradition. Under the leadership of her late father Emilio Botín, Santander had
Receiving Wide Coverage ... Quitting Time: Standard Chartered is getting out of the institutional equities business, and analysts seem to agree the U.K.-based bank is making the right call. Its equity sales and research units was "unprofitable," according to the papers, and shutting them down will save the bank $100 million. Investors have been calling on Standard Chartered to restructure in order to boost earnings; the Financial Times' Lex team suggests that paring down the bank's
Receiving Wide Coverage ... Fed Personnel: Bankers applauded President Obama's nomination of former Bank of Hawaii CEO Allan Landon to the Federal Reserve's Board of Governors. Former American Bankers Association CEO Edward Yingling said Landon's nomination has an "excellent" chance to be confirmed by the Senate, because a large number of lawmakers support having a community banker on the Fed board. Republicans, although they now control the Senate and would normally be hostile to an Obama
Receiving Wide Coverage ... Morgan Stanley Client Data: Morgan Stanley fired Galen Marsh, a 30-year-old wealth-management adviser, after he stole data from about 350,000 accounts and tried to sell the data online, anonymous sources told the Wall Street Journal, New York Times and Financial Times. Marsh's attorney said his client did obtain the account information but he didn't post it online and didn't try to sell it. Morgan Stanley has referred the matter to law enforcement.
Wall Street Journal The Consumer Financial Protection Bureau is exploring a potential new regulation to require payday lenders to make sure borrowers can repay their loans, anonymice tell the Wall Street Journal. The proposal is expected to be discussed early this year in a panel of small lenders the CFPB plans to convene. Such a rule would please consumer advocates, who also want the CFPB to require payday lenders to verify borrowers' incomes, expenses and credit
Editor's note: Morning Scan will publish next on Jan. 5, 2015. Happy New Year from all of us at American Banker and SourceMedia. Wall Street Journal Goldman Sachs just got the fuzzy end of the lollipop in a dispute over an $835 million loan to failed Portuguese lender Banco Espírito Santo. Goldman Sachs' loan was originally transferred to Novo Banco, the "good bank" created after the government rescue of Espírito Santo in August. Now Portugal's central bank
Wall Street Journal It's about to get harder for brokers to hide their dirty laundry from clients, according to the paper. The Financial Industry Regulatory Authority will begin sharing with state insurance regulators a monthly list of securities brokers who have been banned or suspended from the industry. The move stems from concerns that regulatory gaps have allowed some brokers to continue peddling financial products to clients even after they have been nailed for misconduct. A
Morning Scan: Ocwen's Mortgage Settlement Raises Concerns; Could JPMorgan Cyberattack Have Be Prevented?
Editor's note: Morning Scan will publish next on Dec. 29. Happy holidays from all of us at American Banker and SourceMedia. Receiving Wide Coverage ... Investors Worry About Ocwen: Ocwen Financial's legal settlement with New York state banking regulator Benjamin Lawsky led to a sharp drop in its share price on Monday, as investors expressed concern about the company's ability to move past the settlement's onerous terms. Among those terms: William Erbey will step down as chairman
Receiving Wide Coverage ... 'Eternal' Lobbying: Banks got a big win on Thursday when the Fed agreed to delay a part of the Volcker Rule. And former Fed Chair Paul Volcker was none too pleased. In a statement distributed on Friday, Volcker criticized banks for their "eternal" lobbying to avoid having to comply with the rule. "It is striking, that the world's leading investment bankers, noted for their cleverness and agility in advising clients on how
Wall Street Journal Fresno, Calif.: home of raisin farms, a college football team called the Bulldogs, and (who knew?) a federal prosecutor's office that dug up the memo that led to $37 billion in bank fines stemming from the subprime mortgage crisis. The Journal reports on Richard Elias, an assistant U.S. Attorney who discovered JPMorgan Chase documents while working in the Justice Department's Fresno office that led to successful prosecutions of big banks. The JPMorgan memos
Receiving Wide Coverage ... Fed Stays Patient: As expected, the Fed said on Wednesday that it would remain patient when it comes to raising interest rates, and the Journal, New York Times, Financial Times and Washington Post all produced reports on the Fed's meeting. Fed Chair Janet Yellen said the Fed will likely raise interest rates next year, but no sooner than late April, as the central bank exercises patience in waiting for the precise moment
Receiving Wide Coverage ... Fed's New Patience?: Looking ahead to the Federal Reserve's monetary policy statement this afternoon and Fed Chair Janet Yellen's briefing, the Wall Street Journal and the New York Times offer contrasting views on the million-dollar question of when rates could rise. The Journal says the Fed and Yellen may very well drop from the official statement that the Federal Open Market Committee expects to keep short-term rates near zero for "a considerable
Receiving Wide Coverage ... British Stress-Testing: One bank, Co-operative Bank, failed the Bank of England's stress test, while Royal Bank of Scotland and Lloyds Banking Group passed...but barely . The tests were "demanding," but the results show British banks are "significantly more resilient" than last year, Bank of England Governor Mark Carney said. RBS and Lloyds' results were made more palatable by the fact that both have already installed programs to boost their capital levels (although
Receiving Wide Coverage ... PetSmart's Debt Financing: That whole thing about regulators cracking down on big banks for providing too much debt-financing in takeover deals? Eh, who cares? Citigroup is one of five banks that's underwriting billions of dollars in in debt to help finance the $8.7 billion private-equity acquisition of retailer PetSmart led by BC Partners. The debt in the PetSmart deal, in the most recent negotiations, equates to more than six times cash flow.
Receiving Wide Coverage ... Conflict of Interest Strikes Again: Toys tend to make children get greedy, and they appear to produce a similar effect on investment banks. Ten firms were fined $43.5 million Thursday over charges they offered up flattering research analysis in an effort to score a piece of the Toys "R" Us initial public offering. Citigroup, JPMorgan, Wells Fargo and Goldman Sachs are among the banks cited by the Financial Industry Regulatory Authority. Wall
Receiving Wide Coverage ... Through the Back Door: Democrats are pushing back against the GOP's effort to repeal a Dodd-Frank derivatives rule by slipping the change into the government spending bill slated for a vote today. Analysis in the New York Times and Wall Street Journal suggests that getting rid of the rule would be a bad idea but not for the obvious reasons. The provision obliges banks to move a small percentage of derivatives
Receiving Wide Coverage ... Break Up or Buckle Up: JPMorgan Chase will be the bank hardest hit by the Federal Reserve's proposed capital surcharges on the country's biggest banks. Fed vice chairman Stanley Fischer let slip that JPMorgan faces a $22 billion shortfall to meet the forthcoming capital rule during a question and answer session, as American Banker reported last night. Other banks are apparently at or near the minimum levels, and JPMorgan has until 2019
Receiving Wide Coverage ... Shell Shock: Deutsche Bank is accused of owing the U.S. government more than $190 million in taxes, penalties and interest in a lawsuit filed Monday by federal prosecutors in Manhattan. The allegations against the German lender are pretty complicated, as the New York Times warns its readers. The basic charge is that back in 2000, Deutsche wanted to avoid paying capital gains taxes on the appreciated value of Bristol-Myers Squibb stock it
Wall Street Journal It's not often you hear about banks turning away deposits, but the paper reports that a number of banks are suggesting corporate clients take their money elsewhere in light of impending liquidity rules that make holding their cash less profitable. JPMorgan Chase, Bank of America, Citigroup, HSBC and Deutsche Bank are among the lenders that have held this unusual conversation over the past few months, according to the paper. "The change upends one
Financial Times The paper takes a somewhat lengthy look at the New York Fed as the institution struggles with the fallout from secretly recorded internal conversations that show it might be too cozy with the banks it regulates. The article uses as its launching point a Nov. 18 event at the New York Fed's headquarters, which was held to celebrate the Fed's 100th anniversary, and which came a few days before Fed officials were excoriated in
Wall Street Journal The Consumer Financial Protection Bureau's ombudsman for student loans, Rohit Chopra, is being taken to task by some lenders for how he has used public forums to encourage banks to improve their dealings with consumers on student loans. The problem lenders have is the 32-year-old Chopra favors delivering his message in public forums like blogs and letters, compared to other regulators who use more discreet formats. The paper looks at some of the
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