BankThink

I wanted to take a moment and say thank you to the Credit Union Journal team for all the valuable information you publish. Finance Center FCU has been a subscriber for years and we continually read and share your publication across our management team every week.

Obviously [Lockheed CU's] employees have no clue about what it will take to run their institution in 2013. None of these striking employees belong in the credit union industry. Let them work at the bank-that's what they're there for.

Receiving Wide Coverage ...Capital Punishment: The Fed is expected to support the Basel Committee's plan to impose a capital surcharge on the biggest, most globally interconnected financial institutions, the Journal reports. A draft proposal could come before Christmas; JPMorgan CEO Jamie Dimon, whose bank would have to hold another 2.5% of extra capital as a percentage of risk-weighted assets (on top of the 7% required of all institutions) would probably prefer a stocking full of coal. Big banks have lobbied hard against the "G-SIFI surcharge," protesting it would dampen lending and hurt the economy. In another blow to the industry on this front, the European Union said Britain is free under EU law to impose extra capital requirements on her banks above and beyond what Basel calls for, the FT says. The U.K. government plans Monday to adopt that and most of the other proposals by Sir John Vickers' commission, including the "ringfencing" of retail banking from trading. Finally, Bank of America completed its previously announced debt exchange offer, generating $3.9 billion of capital that will count toward Basel III guidelines. The opportunity for banks to raise capital this way — by extinguishing debt at a discount to par — is an advantageous byproduct of bond investors' loss of confidence in the banks' credit. In an environment like this, you have to count your blessings wherever they come from.

As much as I would like to offer tidings of comfort and joy, I fear that 2012 is shaping up to be the year of extreme risks. These risks may not materialize into live problems, but it is best that bankers be prepared, particularly since at least some of the rotten plums are already baked into the Christmas pudding.

Banks won't be happy that a company not subject to federal supervision is filling a void that they, as regulated institutions, were forced to leave.

Lots of bankers have lost their focus on customers, lending and costs. Instead they tune in on distractions, such as politics and regulatory policy. I don't think that's good, but let's use it to shape a strategy that gets results.

Breaking News This Morning ...Hudson City Warning: The New Jersey bank expects to post a fourth-quarter loss after extinguishing costly debt.

Microsoft plans an update next month to remove copies of Internet Explorer 6, an older version of its Web browser that has "more security holes than Swiss cheese," MSNBC.com reported Thursday.

Ancestry.com has removed the Social Security numbers of the deceased from its website.

A lawsuit brought by a group of retail associations and retailers against the Board of Governors of the Federal Reserve System asks the courts to find the board's rules to implement the debit card swipe fee requirements of the Durbin amendment to be "arbitrary, capricious and an abuse of discretion."