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morning scan

Morning Scan: More Banks Embrace Blockchain; Mobile Banking Hacks

Receiving Wide Coverage ... Launching Concord: R3 CEV, a startup tech company that is working with more than 60 banks to build a new banking infrastructure system using blockchain technology, filed for a patent. Concord, as the project is called, aspires to be "a universal platform connecting bank operations within firms and across rival firms. It is aimed at digitizing and speeding up so-called middle- and back-office functions, like clearing and settling securities trades, registering a…

Morning Scan: Reforming the Fed; New Digital Currency?

Wall Street Journal Arbitration rule comments: The CFPB received nearly 13,000 comments on its proposed rule that would restrict the use of mandatory arbitration clauses and make it easier for consumers to sue banks. The rule would prohibit financial services companies from using the clauses to block class-action suits, although consumers would still be required to use arbitration to resolve individual disputes. The agency is expected to issue a final rule next year after it reviews…

Morning Scan: A $500M Idea; Excluding Reserves from Balance Sheets

Wall Street Journal Paying for convenience: More than 20% of bank customers would be willing to pay as much as $3 a month to use their bank's mobile app while about 40% would be in at $1 a month, according to a survey by S&P Global Market Intelligence. Banks could generate as much as $500 million in annual revenue by charging customers, S&P says, with Bank of America, Wells Fargo, and JPMorgan Chase the biggest winners. …

Morning Scan: Bitcoin and Ransomware; Steven Cohen Buys Into Square

Receiving Wide Coverage ... Blame it on bitcoin: Bitcoin may be fueling the recent surge in ransomware attacks, which have quadrupled in the past year to about 4,000 a day, according to the U.S. Department of Justice, "Attacks spiked this year amid the growing use of bitcoin and improved encryption software," the Wall Street Journal said. "Bitcoin is now the preferred payment method of most ransomware infections because it allows users to send and receive money…

Morning Scan: Boosting Bank Stocks; Goldman Names Consumer Bank

Receiving Wide Coverage ... Meet Marcus: Goldman Sachs will name its new U.S. consumer banking arm Marcus. "The familiar first name, reportedly the product of extensive market research and lengthy internal discussions," according to the Financial Times, is the namesake of the company's founder Marcus Goldman. The name also tries to divert attention away from the parent company's various legal and political problems since the financial crisis, according to reports. Wall Street Journal, Financial Times, New…

Morning Scan: Big Cutbacks at Avant; CFPB Goes Undercover

Receiving Wide Coverage ... Convicted: Sean Stewart, a former investment banker at Perella Weinberg and JPMorgan Chase, was found guilty in federal court on all nine counts of securities fraud for passing tips about pending healthcare mergers to his father. The scheme, in which the father recruited a partner to trade on the information, reaped $1.16 million in profits, according to the U.S. Department of Justice. Wall Street Journal, Financial Times Wall Street Journal …

Morning Scan: Citi, JPM Tap New Tech Execs; First Republic Goes for the Gold

Receiving Wide Coverage ... Musical tech chairs: Citigroup named Gavin Michael, American Banker's Digital Banker of the Year, its head of technology for global consumer banking. Michael, head of digital for consumer and community banking at JPMorgan, will replace Mark Torkos, who retired in July. Michael will assume his new role in November. Bill Wallace, who was head of operations for JPMorgan's consumer bank, was named to replace Michael. The two announcements follow the departure of…

Morning Scan: ValueAct Buys Stake in Morgan Stanley; AIG Selling Unit

Receiving Wide Coverage ... ValueAct buys Morgan Stanley stake: The activist hedge fund ValueAct Capital Management said it has bought a 2% stake, valued at about $1.1 billion, in Morgan Stanley, but said it is not looking for the bank to make major changes. "We are completely supportive of [Morgan Stanley CEO James] Gorman and impressed by his leadership over the past six years," ValueAct founder Jeff Ubben told the Financial Times. ValueAct said the market…

Morning Scan: Cordray on Treating Customers; Foreign Banks Unprepared

Wall Street Journal GE sells French mortgages: General Electric received a binding offer for its French prime mortgage portfolio from a newly established French entity backed by an Austrian bank. The deal increases GE Capital's asset sales to about $192 billion, close to its goal of selling $200 billion as part of its plan to disband its GE Capital unit. The deal is expected to close in the fourth quarter. …

Morning Scan: World Economic Forum Endorses Blockchain; Late Heloc Payments

Wall Street Journal Another mortgage bill comes due: More homeowners are missing payments on the home equity lines of credit they took out 10 years ago as the lines reset to include principal payments, not just interest. That can lead to a huge payment shock totaling hundreds of dollars a month for which many homeowners find they aren't prepared. The 30-day delinquency rate on Heloc balances that were originated in early 2006 jumped to 4.4% from…

Morning Scan: More on That Fifth Third Departure; Jefferies on the Move

Wall Street Journal Conflict or no conflict?: Heather Russell, the former general counsel at Fifth Third Bancorp, said she was fired after less than a year at the bank following her disclosure of a romantic relationship with Timothy Mayopoulos, Fannie Mae's chief executive officer. When she was let go last month, the bank said it was based on "a personal matter" that represented "a conflict of interest." Russell, told the Wall Street Journal she "never had…

Morning Scan: Fighting Cyberattacks; It Pays to Be a Whistleblower

Wall Street Journal Preparing for cyberwar: Eight of the largest U.S. banks, including JPMorgan Chase, Bank of America and Goldman Sachs, have joined together to tackle the growing threat of cyberattacks. The banks expect group members to share more information with each other about threats, prepare comprehensive responses and conduct "war games." The financial services industry ranked third in the number of cyberattacks last year, after health care and manufacturing. …

Morning Scan: Barclays Settles Libor Suit; Lending Club Woes

Receiving Wide Coverage ... Barclays settles again: Barclays Bank agreed to pay $100 million to settle charges by 43 states and the District of Columbia that it tried to manipulate the London interbank offered rate thereby defrauding government entities and nonprofits out of millions of dollars. The settlement comes roughly four years after the British bank paid $450 million to settle similar claims brought by federal and British authorities. Wall Street Journal, New York Times …

Morning Scan: Online Lenders Set to Report; Trump's Team

Receiving Wide Coverage ... Trump taps bankers: GOP presidential nominee Donald Trump announced his economic team ahead of a major economic speech in Detroit Monday. The 13-member group is heavily weighted with developers, hedge fund managers and investment bankers, including hedge-fund billionaire John Paulson and Thomas Barrack, founder of Colony Capital. Many have done business with Trump previously. Notably absent are people from Silicon Valley, academia or economics. But there is at least one community banker…

Morning Scan: RBS Posts Big Loss; P2P Lender Gets Financing

Breaking News This Morning ... RBS posts Q2 loss: Royal Bank of Scotland reported a loss of £1.08 billion, or $1.43 billion, in the second quarter versus a profit of £280 million in the year ago quarter. The bank, which is 73% owned by the U.K. government, blamed most of the loss on costs for litigation and potential settlements, which nearly tripled to £1.28 billion in the quarter. Wall Street Journal, Financial Times, New York Times Wall…

Morning Scan: Bitcoin Hack; TIAA in Talks to Buy EverBank

Receiving Wide Coverage ... Bitcoin plunges after Hong Kong hack. Bitcoin plunged 20% yesterday after Bitfinex, an exchange based in Hong Kong, said it had been hacked and funds were stolen. Nearly 120,000 bitcoins were stolen. Bitfinex, one of the largest exchanges for the digital currency, froze all customer accounts as it investigates the breach. Financial Times, New York Times …

Morning Scan: Euro Bank Stock Free Fall; Student Loan Hardball

Breaking News This Morning ... HSBC buyback: HSBC said it plans to buy back $2.5 billion of its stock despite a 40% drop in net income in the second quarter. The recently announced sale of its Brazilian until will help pay for the buyback. Wall Street Journal, Financial Times, New York Times Receiving Wide Coverage ... …

Morning Scan: Wells Offers P2P Payments; Pitfalls of Glass-Steagall, Dodd-Frank

Breaking News This Morning ... Commerzbank stock plunges: Shares of Commerzbank dropped sharply Tuesday after the second largest German bank said it wouldn't be able to achieve its goal of keeping profit stable as revenues drop. Wall Street Journal, Financial Times Wall Street Journal Right idea but wrong slice? Republican and Democrat party platforms favor a return to the Glass-Steagall separation of commercial and investment banking, but few investors would welcome it, says the Heard on the Street…

Morning Scan: JPM Exits T-Bond Settlement; Consumer Debt Worries

Wall Street Journal And then there was one: JPMorgan Chase's decision to stop handling the settlement of U.S. Treasury debt for big bond brokers—leaving Bank of New York Mellon Corp. as the lone firm in the business—has some people worried about how the $13 trillion market will be able to withstand any potential shocks. …

Morning Scan: Credit Suisse Can't Win; MasterCard Courts PayPal

Breaking News This Morning ... Earnings: UBS reported profits fell 14%, but it still beat Street expectations. Wall Street Journal, Financial Times, New York Times Receiving Wide Coverage ... Nobody's impressed: Credit Suisse posted surprisingly respectable earnings on Thursday, with a profit of about $171 million. Still, the troubled bank knows there's more work to do. "It's only a start," said Tidjane Thiam, the company's chief executive. Investors were unmoved – shares of the bank's stock fell 5%.…

Morning Scan: CFPB Cracks Down on Debt Collectors

Receiving Wide Coverage ... Common complaint: Debt collectors, watch out – more oversight is coming. The Consumer Financial Protection Bureau released an outline of new rules for third-party debt collectors Thursday morning. Consumers have submitted far more debt-collection complaints to the agency's database than on any other issue. Under the proposal, debt collectors will have to be more careful to document the debt they're collecting and make it clear that borrowers can dispute the issue, among other…

Morning Scan: Bank Stocks Rally; Grim 2Q for Deutsche, Santander

Receiving Wide Coverage ... Playing the market: Bank stocks are on the rise after a tough first half of the year, rebounding on earnings results announced earlier this month. Still, prices have plenty of room to grow – the KBW bank index is down 7.3% this year. "Banks took it on the chin, but they could show signs of life," Matt Peron, head of global equity at Northern Trust told the Wall Street Journal. "They're certainly…

Morning Scan: Fed to Hammer Goldman Over Leak Case

Receiving Wide Coverage ... Revolving door fallout: More bad news for Goldman Sachs. The Federal Reserve is preparing an enforcement action against the firm over a leak involving the central bank two years ago. The two men at the center of the case – a Fed employee, Jason Gross, and a Goldman Sachs banker, Rohit Bansal, who had previously worked at the Federal Reserve Bank of Nwe York – have already pleaded guilty, while the bank…

Morning Scan: Dems Go Postal; Banks Embrace Faster P2P Payments

Receiving Wide Coverage ... Signed, sealed ... maybe not delivered: Bernie Sanders fans, take heart. The Democrats released their party platform late last week and it includes a proposal for the U.S. Postal Service to offer basic banking services, like cashing checks. The concept has previously been backed by labor unions, Sen. Elizabeth Warren – and yes, Sanders – though the banking industry has tended to resist the effort. …

Morning Scan: JPM to Settle Hiring Probe; PayPal, Visa Make Nice

Receiving Wide Coverage ... Strategic hiring: What's a few jobs among friends? JPMorgan Chase is expected to settle a probe in coming months over alleged efforts to hire the children of powerful Chinese officials and executives in state-owned firms to drum up new business. The bank is expected to pay as much as $200 million and may admit wrongdoing, though it is unlikely to be criminally charged. Wall Street Journal, Bloomberg …

Morning Scan: HSBC Banker Arrested in Forex Case

Receiving Wide Coverage ... Crackdown: A top banker was arrested on criminal charges Wednesday, but those looking for prosecutions resulting from the financial crisis are still going to be disappointed. Mark Johnson, a top foreign-exchange executive at HSBC is accused of "front running" a currency trade for a client in 2011, which was worth about $3.5 billion. The deal won the bank about $8 million at the time, albeit to the detriment of the company involved.…

Morning Scan: Fallout from Republican Shot at Big Banks

Receiving Wide Coverage ... Catching fire: For a Depression-era law, the Glass-Stegall Act has certainly gone prime time in 2016. Observers spent much of Tuesday scratching their heads over the GOP's decision to include in its party platform bringing back the provision. The law, which separated commercial and investment banking activities, was repealed under President Bill Clinton. The New York Times calls the proposal, which has also been backed by many on the left, "almost a…

Morning Scan: New Support for Glass-Steagall; Brexit Maneuvers

Receiving Wide Coverage ... Strange bedfellows: Somehow, this year's presidential race just got even more baffling. Republicans have included a provision to bring back the Glass-Steagall Act in their platform, putting the party in line with those on the left, including Sens. Elizabeth Warren and Bernie Sanders. Donald Trump campaign aide Paul Manafort highlighted the issue during a press conference on Monday, noting that Hillary Clinton's husband, former President Bill Clinton, oversaw the repeal of the…

Morning Scan: More Bank Earnings; Trouble Brews Abroad

Receiving Wide Coverage ... Mixed bag: Bank of America's second-quarter results are better than analysts predicted, but still spell a big drop from last year. The bank's profit fell to $4.23 billion from $5.13 billion a year earlier, while adjusted revenue slid to $20.6 billion from $21.96 billion, B of A reported on Monday morning. Wall Street Journal, New York Times, Financial Times>, American banker …

Morning Scan: Mixed Bag for Citi, Wells Q2 Earnings

Hot off the presses: Citigroup and Wells Fargo reported Friday morning that they saw second-quarter profits fall from a year earlier, though both either met or exceeded analyst expectations. Citigroup reported $4 billion in profit on $17.55 billion of revenue. Wall Street Journal, New York Times, American Banker, Financial Times …

Moving Money Across Borders, Phone to Phone
Bill Barhydt, founder of startup Abra, explains how his company's mobile app uses bitcoin as a payment rail for cross-border remittances while solving the foreign exchange risk and last-mile problem that have hampered adoption of the cryptocurrency.
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