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'Tech Can Reinvent Banking or Dispose of It': Comments of the Week

American Banker readers share their views on the most pressing banking topics of the week. Comments are excerpted from reader response sections of AmericanBanker.com articles and from our social media platforms.

Image: iStock

On how London's booming fintech startup scene could affect the banking industry: On how London's booming fintech startup scene could affect the banking industry:

"Fintech can reinvent banking. Or dispose of banking altogether. Let's try both options?" (via Twitter)

Related Article: British Invasion, Fintech Edition

Image: iStock

On how an influx of postcrisis regulation has changed the nature of banking: On how an influx of postcrisis regulation has changed the nature of banking:

"Banking used to be about helping people obtain their home and trying to protect the place you work for also, but now [it's] trying to make sure you have the fifty pieces of papers signed and in the file."

Related Article: Prune HMDA Reporting Requirements for Small Banks

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On whether the founding of a New Hampshire bank signals a shift in regulators' willingness to approve new financial institutions: On whether the founding of a New Hampshire bank signals a shift in regulators' willingness to approve new financial institutions:

"There is no break for de novo banks in Washington's plans. They want fewer banks and more control. Two new banks in four years is a joke. Remember that Bank [of ] Bird-in-Hand was in Pennsylvania Amish country and approved partly because the local residents didn't drive. The Bedford residents do have cars so maybe that can be considered a break in the regulatory logjam."

Related Article: Is the New-Bank Logjam Finally Breaking?

Image: iStock

On regulators' preference that startup banks have large groups of investors: On regulators' preference that startup banks have large groups of investors:

"Broad-based community investment groups tend to be more conservative, more focused on the long-term needs of the local business community that the bank will serve than on using the bank to make profits, ratchet up stock values through growth of assets and ROE, and cashing out in five years or so. If that's going to be a requirement going forward, however, it will dampen the enthusiasm of a number potential capital sources" (Via Bank Lawyer's Blog).

Related Article: Is the New-Bank Logjam Finally Breaking?

Image: iStock

On Citizens Financial's plans to expand its auto-lending division in part by offering longer-term loans to customers with lower credit scores: On Citizens Financial's plans to expand its auto-lending division in part by offering longer-term loans to customers with lower credit scores:

"We've seen this movie before. History shows that late entrants, particularly aggressive ones, usually end up faring badly. Current delinquency and charge-offs are not reliable indicators of future losses, particularly in lenders with rapidly growing portfolios."

Related Article: Citizens Financial Revs Up Auto-Loan Risk

Image: Bloomberg News

On the Consumer Financial Protection Bureau's newly proposed rules for the payday lending industry: On the Consumer Financial Protection Bureau's newly proposed rules for the payday lending industry:

"A government-mandated limit on 6 loans per year and a mandated waiting period of 60 days. Sounds like NYC's beverage limits."

Related Article: Cheat Sheet: CFPB's Game-Changing Plans to Rein in Payday Lenders

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In response to an argument that banks overcharge merchants for swipe fees: In response to an argument that banks overcharge merchants for swipe fees:

"Does the retail industry really want to begin an analysis of 'fair pricing'? How much mark-up on a toaster is 'fair'? Price controls always create imbalances and inefficiency. If the retail industry does not want to pay interchange fees simply accept cash only. What the retail industry really wants is the speed, convenience, safety and availability of electronic transactions with someone else paying the cost."

Related Article: How Fed Policy on Swipe Fees Quashes Market Forces

Image: iStock

On the news that Sen. Elizabeth Warren and several other prominent Democrats want regulators to clarify the steps nonbanks classified as systemically important financial institutions would need to take to shake off the label: On the news that Sen. Elizabeth Warren and several other prominent Democrats want regulators to clarify the steps nonbanks classified as systemically important financial institutions would need to take to shake off the label:

"It doesn't strike me as at all odd that Sen. Warren and others would support a two-way street for FSOC designation. The point of the exercise is to regulate systemic risk; unless a firm can move down or off the systemic-risk scale by reducing its systemic profile, the designation process is simply a trap, not a regulatory mechanism."

Related Article: Warren, Other Dems Take Surprising Stand on FSOC Delistings

Image: Bloomberg News

On an op-ed by Consumer Bankers Association head Richard Hunt arguing that the consumer complaints submitted to the CFPB's database should be verified and/or contextualized: On an op-ed by Consumer Bankers Association head Richard Hunt arguing that the consumer complaints submitted to the CFPB's database should be verified and/or contextualized:

"Not surprised Hunt concerned w/unfiltered complaints. Consumers' complaints need platform. Digital age, digital reviews." (via Twitter)

Related Article: CFPB's Unfiltered Complaint Database Is Just White Noise

Image: Bloomberg News

American Banker readers share their views on the most pressing banking topics of the week. Comments are excerpted from reader response sections of AmericanBanker.com articles and from our social media platforms.

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