BankThink

Receiving Wide Coverage ...JPMorgan Reaches Big Mortgage Accord: The New York bank agreed to a $13 billion settlement to resolve the government's longstanding issues with questionable mortgage practices. The Wall Street Journal said the "historic settlement," which ends multiple probes into mortgage bonds issued before the financial crisis, is the largest amount of fines and damages the government has secured from a company in a civil settlement. The New York Times notes that $4 billion in consumer relief was the key component of the deal. The Financial Times reported that JPMorgan agreed to not file any claims with the FDIC, which brokered the sale of Washington Mutual to the company.

Seeking to narrow the range of activities in which well-capitalized and well-managed bank holding companies can engage is a mistaken endeavor. Prohibiting activities will lessen competition, increase risk and raise costs for customers.

As a fast, low-cost payment system, Bitcoin provides healthy competition for legacy banks. It's also a bulwark for financial privacy and freedom of speech.

As a fast, low-cost payment system, Bitcoin provides healthy competition for legacy banks. It's also a bulwark for financial privacy and freedom of speech.

The same thing that doomed communism will likely undermine Bitcoin: the fantasy that a protocol, a procedure, a network, an algorithm can neutralize the ugly selfish traits of human beings.

With their regulatory status, refined customer identity procedures and global infrastructure, banks could offer bitcoin exchange services and lead the modernization of financial services. Instead, they’re freezing Bitcoin entrepreneurs’ accounts.

Receiving Wide Coverage ...Holiday Reading: The long-simmering battle between five federal agencies over the Volcker Rule appears to be in its final stage. The current draft is around 1,000 pages, and it's expected to be finalized before the end of the year. The basic dynamics here — with the Fed and the SEC pushing for looser restrictions, while the CFTC seeks tighter rules — are old news. But the New York Times has a detailed look at some of the places where the agencies remain at odds, including the draft language defining market-making. The Times also reports: "Since the Volcker Rule was first proposed in 2011, regulators have had to contend with a fierce lobbying campaign by the banks. But that effort lost momentum last year, after JPMorgan's trading debacle revealed that its traders were placing enormous speculative bets under the guise of hedging." Meanwhile, the Financial Times reports that the Fed is considering giving banks until July 2015 to comply with Volcker's new restrictions.

A recap of the informed opinions (and the discussions they generated) this week.

In a report released Thursday, the Government Accountability Office urged the Federal Reserve Board and other regulators to finalize key provisions of the Dodd-Frank Act that are designed to decrease government support to big banks and improve bank oversight going forward.

Moody's downgraded the ratings of Morgan Stanley, Goldman Sachs, JPMorgan Chase and Bank of New York Mellon by one notch on Thursday.