Jeff Horwitz

Receiving Wide Coverage ...HSBC Settlement Redux: Wednesday was the tail end of the HSBC money laundering news cycle, with major papers scrutinizing the bank's $1.9 billion deferred prosecution agreement with the U.S. According to the 21 law enforcement officials, the bank's misconduct was egregious, sustained, and possibly willful. (Either that or nobody noticed when people started regularly showing up at Mexican HSBC branches with boxes of cash that fit precisely through the holes in the teller windows.) But HSBC's behavior wasn't termed criminal, because the government decided that there would be too much collateral damage and opted for a "deferred" prosecution. The FT delves into the terms of the deal more deeply than its U.S. counterparts, reporting that HSBC will spend "$700 million on a global "know your customer" program, one of 26 points of a compliance agreement. Click on any of the links in the paragraph above and you'll find HSBC chief Stuart Gulliver apologizing.

In the first of the FDIC's 39 suits against bank executives, it has won a jury verdict declaring three former IndyMac executives breached their fiduciary duties by lending recklessly to home builders during the housing boom.

Wall Street JournalIn what is either an oversight or an extreme dislike of jargon, the Journal managed to write an 800-word article on the imminent expiration of the Transaction Guarantee Program (TAG) without once using the phrases "Transaction Guarantee Program" or "TAG." The gist is that the Senate would re-up the program, the Republican-dominated House won't, and small banks are seething and fighting for an extension.

New CEO Michael Corbat will cut 11,000 jobs, largely in Citi's global consumer banking division. The plan suggests Citi is hedging its strategy of being an omnipresent, upper-tier player in emerging markets.

Fannie's bid to cut force-placed insurance costs by hundreds of millions of dollars has won the Swiss giant's participation. For existing market leaders and their bank partners, less lucrative times may lie ahead.

Suit aims to block the Commerce Bank founder and CEO from selling his book on how to "WOW" customers.

Credit Suisse becomes the latest institution charged with fraud involving mortgage securities in an investigation that is expected to involve others.

The government mortgage giant's plan, which awaits regulatory approval, aims to cut premiums by hundreds of millions of dollars and end a stream of payments to banks.

New York's Attorney General has issued a letter demanding that Wells Fargo (WFC) resume processing mortgage modification requests for borrowers in states hit by Hurricane Sandy.

Receiving Wide Coverage ...Money Market Funds Redux: Take 2 on money market funds is coming from the Financial Stability Oversight Council. The SEC couldn't get its act together on regulating money market funds — which have a longstanding tradition of telling investors they have a fixed value even though they kinda don't — so FSOC's stepping in. The council has told the SEC to pick the issue up again, though it's not being didactic. The SEC still can choose whether a floating net asset value or capital buffers would be appropriate. But if the agency doesn't act, the FSOC says it will. The concern for the money market industry is that, at some point, regulators get so fed up that the FSOC simply delegates the issue to the Federal Reserve and imposes a fluctuating asset value on the funds. That's "the easiest solution," one expert tells the Washington Post. While the mandate to the SEC is being viewed as the first instance of the FSOC flexing its muscles, we're not sure that it's proof of the council's robustness. Ever since a major fund "broke the buck" during the financial crisis and caused a massive dislocation in the short-term credit markets, pretty much everyone aside from the funds themselves has agreed that money markets are in clear need of greater regulation. The Financial Times provides a reminder of how slow and cautious the FSOC process is: the body is still working to determine whether AIG is systemically important, though the determination is under "advanced consideration."

Receiving Wide Coverage ...Well, that's that. Despite a few seats changing hands, both the executive and legislative branches are going to look the same as they did before the election, plus one Elizabeth Warren. How we got there involves a feisty Republican primary, plenty of vitriol over basic facts and statistics, and a broad win for the president that was shallower than the one four years ago.

Despite losing out in the auction of ResCap, Nationstar says it's got plenty of acquisition opportunities in front of it.

Receiving Wide Coverage ...Banks Take Back Seat: Wide coverage? That'd be the election and the hurricane, of course. The only banking story covered by more than one major paper is HSBC's $800 million additional reserve for its U.S. money laundering case. That brings the tab to $1.5 billion, and it could rise "significantly higher." CEO Stuart Gulliver acknowledged the rising tab and correlated reputational damage. The bank lost money in its European and North American businesses, relying on emerging markets for the good news. The brightest spot in was HSBC's performance in Hong Kong, which brought the bank a profit of $1.8 billion.

Under the OCC, a complex foreclosure review process is funneling hundreds of millions of dollars to administrators and advertisements. Critics charge that banks and homeowners would be far better served by a simpler program.

Independent foreclosure reviews at the major banks were meant to compensate wronged homeowners and restore some faith in the integrity of mortgage servicing. Instead, the process has become mired in questions of objectivity.

New York State's Department of Financial Services has ruled that, for insurance purposes, Hurricane Sandy wasn't a hurricane when it hit the state.

The leading insurer in the force-placed market is working to make its products more flexible as regulators push on pricing and payments to servicers. Some large banks are changing their practices, too.

Receiving Wide Coverage ...Citi's Shakeup, Day Two — Receiving Unsolicited Advice and Reassuring Everyone: Yesterday saw the introduction of new CEO Michael Corbat, and today Citi's rolling out the man who installed him atop the bank. Michael O'Neill "represents a new generation" of bank directors, the Times declares, citing his "unusual" decision to visit Citi's trading floors and take a close look at the bank's business lines after he became chairman of the bank earlier this year. O'Neill offers praise for former CEO Vikram Pandit to the Times, but declares that "Mike Corbat has a sort of single-minded data approach that is right for the job today."

The respected former B of A executive says shareholder capitalism has gone awry, and that bank directors should be just as worried about outperforming business units as laggard ones.

In selecting Michael Corbat as its new CEO, Citigroup is turning to a team player who's overseen the sale of a half-trillion dollars in assets since the financial crisis.