BankThink

Receiving Wide Coverage ...An Actual Romney Reboot? The papers are awash with recaps of the first presidential debate, in which Obama and Romney argued over healthcare, taxes… and banks! Being who we are, we'll stick to the outlets that covered the banking news. Romney hit Obama on the slow pace of establishing a definition for a qualified residential mortgage (undeniable even if the immediately beneficial effect of having a rule in place is unclear) and Dodd-Frank, which the Republican described as "the biggest kiss that's been given to New York banks I've ever seen." (We can think of several executives of large banks who would disagree.) From across the pond, the Financial Times declares Romney the winner.

Basel III is nearly incomprehensible to most readers, including bank directors, managers, and analysts. Of what use is a measure no one can understand? Tangible equity capital is understood by all.

"Angst over fair-lending enforcement was palpable," at a mortgage conference where lenders asked advice about the upcoming Consumer Financial Protection Bureau exams, observed our Kate Berry. Industry experts provided answers. Step One: check your HMDA data...

The payment hierarchy is dynamic. Lenders using historical payment models to set strategy risk significant exposure on their existing loan portfolios as well as on acquisition opportunities when consumer preferences inevitably shift.

A judge's decision to vacate the Commodities Futures Trading Commission's rule on position limits for derivates undermines all Dodd-Frank implementation efforts, writes an op-ed contributor to The Street.

An alternative capital requirement that allowed Lehman and Bear Stearns to build up huge subprime portfolios and incur excessive leverage remains in effect for six large broker-dealers and investment banks.

Serving the unbanked requires a worldview that most industry insiders don't have, but truly need in order to innovate responsibly on behalf these consumers. Here are insights some companies have gleaned from spending a day as the underserved.

Receiving Wide Coverage ...Schneiderman vs. JPMorgan, Day Two: JPMorgan Chase tells the Journal that New York Attorney General Eric Schneiderman's lawsuit alleging securities fraud by JPM predecessor institution Bear Stearns "recycle[s] claims already made by private plaintiffs." Specifically, a lot of the profanity-laced trader emails and statistics cited by Schneiderman were also in a suit filed against JPM by the bond insurer Ambac. Moreover, a member of Schneiderman's staff worked on the Ambac case at a previous job with a private law firm. An anonymouse tells the paper that after JPM pointed out this connection in a meeting, the staff member was recused from working on the investigation "out of an abundance of caution." The FT says the case "is expected to be the first in a new wave of US regulatory action against banks for alleged wrongdoing in the run-up to the financial crisis." The Journal's "Heard on the Street" column similarly calls the Schneiderman suit "a reminder that the mortgage boom and bust remains a live issue," even if "the worst losses from housing may be behind banks." The Times' "White Collar Watch" columnist Peter J. Henning parses the complaint and finds "little new information" about the boom-era Wall Street mortgage securitization machine that wasn't already public. However, he spots one novel allegation: that Bear Stearns pocketed the money it collected when forcing originators to buy back loans that defaulted early, rather than passing these proceeds on to investors. "If true, that goes beyond just shoddy practices to something much more akin to theft," Henning writes. Another Times article notes that Schneiderman brought his claims under the Martin Act, a long-time weapon of choice from the arsenal of Empire State prosecutors.

It's been my experience that the closing of in-store branches generates more chatter than the fact that another bank often immediately opens and prospers in those exact spaces.

In a court hearing retailers will argue that the Federal Reserve Board got the implementation of the Durbin amendment wrong with the 21 cent limit. They argue the Fed's early proposed 12 cent limit was the more accurate interpretation of that part of Dodd-Frank.