Banking news roundup

May 19, 2023 2:54 PM

Louisiana Credit Union League names new CEO, scammer who helped criminals pose as bankers jailed for 13 years, Jack Dorsey leads funding round for bitcoin voucher company and more in this week's banking news roundup.

Louisiana Credit Union League names new CEO

The Louisiana Credit Union League has named Juan Fernández Ceballos as its next president and chief executive. Ceballos, who is currently the president and CEO of the Credit Union Association of New Mexico, will take the helm of the trade group on June 20. "This is a fantastic institution, and I am excited to work with the board of directors and all staff to continue the growth and success and help credit unions continue fulfilling their missions," Ceballos said in a press release. —Frank Gargano

Sezzle adds shorter term BNPL plans for groceries

Buy now/pay later lender Sezzle has launched a "Pay-in-2 product" which enables shoppers to pay 50% for purchases at the point of sale, then the remaining half two weeks later. Sezzle wants to expand to new categories, such as groceries, subscription and other products that fit better into two installments than the typical four installments for most BNPL products. Sezzle also offers the typical pay-in-4 over six weeks BNPL option as well as a monthly installment plan of up to 48 months. During the inflation spike of the past year, BNPL lending has expanded into categories beyond one-off purchases, moving into retailers such as supermarkets. BNPL lender Affirm, for example, has reported its Debit+ Visa card has proven popular for grocery purchases. —John Adams

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Two Pennsylvania credit unions announce merger plans

First Commonwealth Federal Credit Union in Allentown, Pennsylvania, and Bellco Federal Credit Union in Wyomissing, Pennsylvania, are planning to merge. The combined institution would have more than $1.3 billion of assets and more than 92,000 members across the state, with a deal expected to close in the first half of 2024, pending approval by the National Credit Union Administration. "With shared values rooted in the wellbeing of our members and communities, complementing retail footprints, and strong financial positions, this partnership is a natural fit for both organizations' members, employees, and communities," Donna LoStocco, president and chief executive of First Commonwealth, said in a press release on Tuesday.
—Frank Gargano

Ripple debuts international digital currency platform

Ripple has developed a platform that's designed to aid central banks, government agencies and financial institutions that are working on central bank digital currencies, stablecoins and other digital assets. The platform includes tools that are key to building digital currencies, such as ledger technology, token minting, distribution, redemption and destruction, inter-institutional settlement and digital wallets. The platform is designed to address wholesale CBDCs, which are designed for large international transfers between corporations, governments or banks; and consumer-oriented retail CBDCs. It can also support stablecoin issuance. Ripple earlier this week announced it has acquired Mataco, a cryptocurrency-custody firm to reach more international clients. Ripple is also working with Montenegro and other central banks on CBDC projects. —John Adams

BlackRock pushes employees back to office four days a week

BlackRock is calling employees back to offices at least four days a week, telling staff that the firm has found benefits from working together in person after the pandemic. The new policy will take effect Sept. 11, with flexibility to work from home one day a week, Chief Operating Officer Rob Goldstein and Caroline Heller, global head of human resources, said Tuesday in a memo to staff. "Career development happens in teaching moments between team members, and it is accelerated during market-moving moments, when we step up and get into the mix," the executives wrote. "All of this requires us to be together in the office." The world's largest asset manager rolled out its "Future of Work" pilot program in late 2021, when New York-based BlackRock said it expected more than half of its personnel to work in the office at least three days a week. The firm had about 19,800 employees in more than 30 countries at the end of last year.—Silla Brush, Bloomberg News

Goldman banker wins promotion, then leaves for rival two weeks later

A Goldman Sachs investment banker quit his post just two weeks after landing a plum position in the firm's prized merger advisory unit.
Troy Broderick, who was named chief operating officer of the financial giant's M&A business earlier this month, is leaving for boutique investment bank Perella Weinberg Partners, according to people with knowledge of the matter. The exit follows that of Russ Hutchinson, who got the same role at Goldman Sachs in November, only to depart five months later.
Broderick, a managing director at the bank, and representatives for Goldman Sachs and Perella Weinberg declined to comment. Both Broderick and Hutchinson are successful Black executives in the world of high finance, which is wrestling with diversifying its top ranks. Their exits highlight the challenges banks face in promoting and retaining Black talent while trying to fend off competitors trying to snag them. Hutchinson is set to be the next chief financial officer of Ally Financial. —Sridhar Natarajan and Liana Baker, Bloomberg News

Farmers & Merchants in Ohio changes name

Farmers & Merchants State Bank in Archbold, Ohio, has rebranded as F&M Bank. The $3 billion-asset unit of Farmers & Merchants Bancorp unveiled a new logo that the bank said would be rolled out across its footprint over the summer. The logo and shortened brand name resulted from a multiyear brand exploration process. The new logo is intended to honor the bank's legacy, while looking toward the future, the company said in a press release. "F&M's mission remains as it always has, to nurture lasting relationships with our customers, our employees, our communities and our shareholders. Now we're saying more, with a little less," Amy Cover, chief marketing officer, said in the release. —Jim Dobbs

Scammer who helped criminals pose as bankers jailed for 13 years

The mastermind behind a global "spoofing shop" that scammed victims out of as much as £100 million ($124 million) has been sentenced to over 13 years in a U.K. prison. Tejay Fletcher, 35, pleaded guilty over his role as the lead administrator of the website ISpoof.cc, an online shop where criminals bought a subscription to buy scamming tools. He was charged with fraud and criminal property offenses between 2020 and 2022. ISpoof provided software that allowed fraudsters, who paid in Bitcoin, to disguise their phone numbers so it appeared they were calling from major banks including Barclays, HSBC and Lloyds. The software made it easier to trick people into giving them personal details to drain their bank accounts. The probe was the U.K.'s largest fraud investigation led by London's Metropolitan Police Service, who worked in connection with the FBI, Europol and Dutch authorities. —Katharine Gemmell, Bloomberg News

Jack Dorsey leads funding round for bitcoin voucher company

Jack Dorsey, co-founder of payments company Block, previously known as Square, led a $6 million seed funding round for Azteco, which provides vouchers for small amounts of bitcoin that users can redeem online. The seed round was announced on Thursday. The company, which launched in 2014, says this funding will help it develop and refine its products. "Azteco is providing so much more than just access to a secure financial system; it is building an ecosystem of financial self-determination that is secure and supported by local communities," said Dorsey in a press release. —Miriam Cross