Not too shabby: Despite losing his cash bonus, Wells Fargo CEO Timothy Sloan didn't do too badly last year. The bank disclosed that Sloan was awarded $12.83 million in compensation for 2016, including $2.33 million in base pay and stock valued at $10.5 million. The bank said the package reflected Sloan's promotion to president and chief operating officer in late 2015 and his elevation to CEO last October, after his predecessor John Stumpf resigned in the wake of the fake accounts scandal. He received $11 million in total compensation in 2015. Sloan's pay package for 2016 was the lowest of major U.S. bank executives, according to the Wall Street Journal.
Photographer: Cindy Charles
Wall Street Journal
Overdraft income rebounds: Bank overdraft fee revenue rose 2.5% to $33.3 billion in 2016, according to Moebs Services. That was the highest figure since 2009, the year before the Federal Reserve implemented rules that required customerswanting the protection to opt in. Moebs said the median fee at banks was $30 a transaction although some banks charge as much as $45.
Below trend: The Federal Reserve raised interest rates Wednesday for the second time in four months, but bank lending isn't keeping pace with a growing economy. Total bank loans across all categories are rising at a 4.6% annual rate, the slowest pace since 2014, according to weekly Fed lending data from March 1. Growth in lending to business is even slower, up only 3.9%, close to a six-year low. The trend "raises questions about whether investors' expectations will be realized," the paper commented.
Bottom fishing: Goldman Sachs bought 8,000 delinquent mortgage loans with unpaid balances of $1.4 billion at Fannie Mae's latest auction. Goldman has acquired nearly two-thirds of the $9.6 billion in loans the agency has auctioned over the past 18 months.
Financial Times
Good, but not great: Wall Street's bonus pool rose last year for the first time in three years. According to the New York State Comptroller's office, total bonuses paid to securities industry workers in New York City totaled nearly $24 billion last year, up 2% from 2015. The average bonus was $138,210, slightly higher than in 2015, but still well short of the record $191,360 of 2006, before the financial crisis. But analysts interviewed by the FT "cautioned that the figures were unlikely to herald a dramatic pick-up in pay on Wall Street, where many banks are still struggling to hit profit targets they have outlined to shareholders."
One step ahead: The word "innovation" may have positive connotations, but not always in finance. "As any police officer will testify, criminals are among the most innovative people on the planet," notes Izabella Kaminska, writing in the FT's Cyber Security column. "And one area in which this is becoming abundantly clear is the fast expanding high-tech financial service industry. The spike in digital financial crime accompanying the frictionless payments systems these technologies promote suggests criminals may be innovating as quickly, if not quicker. For now at least, more fintech equals more 'crimtech.'"
Quotable ...
"So far, banks have largely gotten a 'free pass' on well-publicized decelerating loan-growth trends. At some point, we have to imagine that investors will begin to express more concern." — Sandler O'Neill + Partners analysts
A new Citizens Bank survey suggests rising check-fraud incidents are driving middle-market companies to accelerate plans to fully adopt digital payments. But 70% of all businesses will continue to rely on checks for years to come, according to recent data from the Association for Financial Professionals.
After several quarters of slumping investment banking and trading fees, the Charlotte, North Carolina-based company reported a big uptick from that division, which helped compensate for a large decline in net interest income.
The Federal Reserve's Office of the Inspector General says the Fed has yet to fulfill 65 recommendations, and also identified 18 outstanding issues at the Consumer Financial Protection Bureau.
The bank will use biometric authentication to streamline checkout in stores starting in 2025. It has already completed internal and external pilots of the technology.
Banks reported nearly $27 billion had been tied up in scams or theft against elderly people in a recent 12-month period, according to a report from the U.S. Treasury.
