Banking news roundup

February 18, 2022 2:45 PM

Coinbase experienced technical difficulties it attributed to viewer response to its commercial during the Super Bowl, Home BancShares bought a boatload of yacht loans and Flushing Financial in New York joined the growing list of banks doing away with overdraft fees. Scroll through to see what you might have missed this week in banking, cryptocurrency, payments, credit unions and more.

Delay of game

Coinbase Sued Over XRP Commissions After SEC Pursues Ripple

Tiffany Hagler-Geard/Bloomberg

Coinbase was forced to reduce access to its site for about an hour on Sunday evening, a technology glitch the crypto exchange attributed to record traffic around the time of its advertisement during the Super Bowl. Coinbase's ad, which could have cost the company as much as $14 million based on rates for this year's Super Bowl advertisements, showed a QR code moving around a screen for a minute. Viewers who scanned the code were directed to Coinbase and invited to receive $15 worth of free bitcoin and a chance to win prizes of up to $3 million. Other crypto currency companies ran ads during the game, including a Crypto.com ad featuring LeBron James and an FTX commercial with Larry David. — John Adams

What we can learn from bank runs

Bank runs are scary, and the reason we have the FDIC. A new working paper from researchers at the Federal Reserve Bank of New York and Princeton University looks at bank runs during the 1931 German Crisis, during which the Great Depression drove a number of institutions into insolvency. During a run, banks lost 20% of their deposits, with both retail and wholesale customers rushing to withdraw funds. But this happened both at banks that subsequently failed and at those that survived, suggesting that depositors couldn’t tell accurately which ones would make it through. The lesson for today’s regulators is that deposit insurance doesn’t distort the market, the researchers found. “Since regular depositors appear uninformed, it is unlikely that deposit insurance would exacerbate moral hazard,” wrote authors Kristian Blickle, Markus Brunnermeier and Stephan Luck. “Instead, interbank depositors are best positioned for providing 'discipline' via short-term funding." — Chana R. Schoenberger

Greenlight gets 'immediate lift' from Super Bowl spot

Greenlight, a digital banking app for families, kicked off a national campaign with a Super Bowl commercial featuring “Modern Family” star Ty Burrell. In the ad, he buys a series of outlandish products, announcing “I’ll take it!” until he goes broke in a shoe store. A father uses the episode as a teaching moment for his children. “After the ad aired, we saw an immediate lift across every step of our funnel, from visits to downloads to sign-ups,” said Rachel Hamilton, Greenlight’s chief marketing officer. The campaign will run for up to six months and include three videos with Burrell about earning, saving and investing with Greenlight. — Miriam Cross

JPMorgan preps for Investor Day

First Day Of Trading On Floor Of NYSE In 2022

Michael Nagle/Bloomberg News

JPMorgan Chase will host an Investor Day this year after all. On Friday, while speaking at an industry conference, JPMorgan CFO Jeremy Barnum said the company is planning a meeting for investors and analysts that will take place sometime before summer. The exact day and time have not yet been determined. “At this point, it seems pretty clear that the market wants to hear more from us and we’re eager to kind of tell the story and take some time to go into more detail,” Barnum told an analyst. The last time the nation’s largest bank by assets hosted such a day was on Feb. 25, 2020 — about two weeks before the World Health Organization declared the coronavirus outbreak a pandemic. Investor Day 2021 was scrapped altogether due to the health crisis. — Allissa Kline

Crypto for charity

Fidelity Charitable, the country’s largest donor-advised fund, reported that its donors gave away a record $10 billion to charities last year, up 41% from prepandemic times. Of that total, 66% were noncash assets like stocks, a popular tax strategy that involves donating shares that have appreciated rather than pay capital-gains taxes on the profits. That included $331 million in cryptocurrency donations, a twelvefold increase over 2020. Of those, the fund said, 88% of crypto gifts were in Bitcoin, 11% were Ethereum and 1% were another token, like Litecoin. — Chana R. Schoenberger

Home BancShares buys bundle of yacht loans

Home BancShares in Conway, Arkansas, is betting big on really big boats. The $18 billion-asset company said this month it had acquired LendingClub Bank’s marine loan portfolio, which consists of about $238 million of yacht loans. Home’s Centennial Bank will service the acquired portfolio and originate new yacht loans to meet pent-up demand for luxury investments by wealthy Americans. With the acquired loans, Centennial’s Shore Premier Finance unit will have total loans of $1.13 billion. — Jim Dobbs

Phishing, ransomware bankers’ top cybersecurity concerns: Survey

Bloomberg News

According to survey results released in January, bank executives ranked cybersecurity threats their No. 1 concern for 2022, ahead of hiring and retaining talent, meeting customer expectations and other issues.

Within cybersecurity, executives cited phishing aimed at employees and customers as the top threats, followed by ransomware.

The fintech and cybersecurity consultant CSI conducted the survey. Sean Martin, director of product strategy for CSI’s managed services, said, “The essential message banks should communicate to customers is that, at some point, they will likely be a target of a phishing campaign and if they are diligent they can mitigate their risk.” — Carter Pape

Colorado to introduce pay-taxes-with-crypto bill

Jared Polis.

Michael Ciaglo/Photographer: Michael Ciaglo/Get

Colorado plans to introduce a bill by the end of the summer that would let consumers and businesses use cryptocurrencies to pay their taxes. The state said it would hire a company to process crypto transactions and create what Gov. Jared Polis, a Democrat, calls a "transactional layer" to avoid the speculative risk of holding cryptocurrency. Polis first announced the plan to accept crypto payments in 2021. Polis has long been a cryptocurrency booster. As a member of the U.S. House of Representatives, he formed a blockchain caucus to raise awareness of cryptocurrency and the use cases for the underlying blockchain technology, and he has accepted campaign contributions in crypto. — John Adams

Join this credit union, feast on avocado toast

Alliant Credit Union in Chicago is offering a $200 prepaid “Avocado Toast and Iced Coffee” Visa card to the first 1,500 to apply to open a checking account with the institution as a new member between Feb. 15 and March 4. “In welcoming new members to take advantage of Alliant’s great interest rates and no overdraft fees, we hope to keep more money in their pockets for life’s big plans and small comforts,” Norm Buchanan, vice president and chief product and experience officer at the $15 billion-asset Alliant, said in a press release. —Frank Gargano

Flushing Financial eliminates overdraft fees

KittyKat - stock.adobe.com

Flushing Financial in Uniondale, New York, has eliminated overdraft, insufficient funds and transfer fees on its consumer checking accounts. Tuesday’s announcement by the $8 billion-asset Flushing, parent of Flushing Bank, follows similar moves by a raft of money-center banks. Flushing reported $6 million of income from banking services fee income in 2021. “Eliminating these fees is one way we can distinguish ourselves by providing tangible value to our customers and rewarding them with something that is not offered by most of our competitors,” President and CEO John Buran said in a press release. — John Reosti