Wrong direction?: American International Group said its second quarter net income fell 17% to $937 million, largely due to a $200 million pretax restructuring charge, reduced investment income “and another weak showing for its big business of selling property-casualty policies to corporate clients,” the Wall Street Journal reports. The quarter marked the one-year anniversary of CEO Brian Duperreault’s turnaround effort.
A security guard stands inside the American International Group Inc. (AIG) headquarters office in New York, U.S., on Tuesday, Jan. 29, 2016. American International Group Inc., the insurer being pressured by activist investor Carl Icahn to divest assets, had the outlook on its credit rating changed to negative from stable by Standard & Poor's after announcing plans to sell a stake in mortgage insurer United Guaranty Corp. Photographer: Victor J. Blue/Bloomberg
Victor J. Blue/Bloomberg
The restructuring charge, which AIG said was “primarily related to efficiency initiatives,” “is likely to intensify investors’ concern about the speed of the turnaround, which comes against a backdrop of pricing pressure in the global insurance industry,” the Financial Times says.
On its way: Royal Bank of Scotland said it will start paying dividends for the first time since the financial crisis, pending the finalization of a fine with the U.S. over toxic mortgage-backed securities.
Not enough humans: Experian is looking to use artificial intelligence “to predict application behavior more quickly and reliably, and to identify and fix problems before they impact customers. Just as manufacturing firms added sensors to monitor the performance of generators and compressors, Experian now is doing the same thing with software. Machine learning helps Experian manage an increasingly complex IT environment as the business world faces a shortage of technical talent and adapts to the fast-paced nature of software development.”
Have your say: Readers sound off on whether or not it was appropriate for President Trump to criticize the Federal Reserve.
Financial Times
Turnabout: HSBC is looking to sell its “know your customer” software to other banks. The compliance system, “which combines robotic process automation and machine learning technologies to carry out automated checks on clients,” will be offered through EXL, a U.S.-based outsourcing company. “The move underlines how much HSBC believes its client-checking systems have improved six years after it was fined almost $2 billion and narrowly escaped criminal charges for breaching money laundering and sanctions rules in the U.S.”
New York Times
Monopoly: Australia’s four biggest banks, which control a 75% market share, “have used their dominant position to exploit customers, deliver inferior products, charge exorbitant fees and block competition,” a government commission said.
Back in business: Prince Alwaleed bin Talal, the big Saudi Arabian investor in Citigroup and other companies, is getting into the music streaming business. The $270 million investment in Deezer is the prince’s first international deal since he was freed from three months’ detention in the Riyadh Ritz-Carlton following his arrest by the Saudi government on corruption charges.
New math: The paper has a neat interactive showing readers combinations of various companies whose values add up to the worth of one: Apple, which crossed the trillion-dollar mark. One slide pits the four largest U.S. banks (JPMorgan Chase, Bank of America, Wells Fargo, Citigroup), against the tech giant. Winner? The banks ($1.168T).
Quotable
“Humans never get much above 95% accuracy when they are filling out forms as it is quite tedious work, but automating it gets you much closer to 100%.” — Kirsty Roth, head of operations at HSBC, about the bank’s new customer identification compliance system.
BayFirst Financial, which has reported problems with SBA loans, expects to reach an agreement with its regulators in connection with credit administration and other issues.
A report from J.D. Power indicates that the neobank Chime gained the highest percentage of newly opened checking accounts in the third quarter of 2025.
The court upheld the Federal Reserve Board's right to block Custodia from direct access to its payment systems. The bank is considering asking for a rehearing.
The Tacoma, Washington-based bank, which has completed two mergers since 2023, said Thursday that it will buy back up to $700 million of its own shares over the next year.
New York State's former top regulator Adrienne A. Harris has rejoined Sullivan & Cromwell as of counsel and senior policy advisor; Founders Bank appointed Karen Grau to its board of directors; Deutsche Bank's DWS Group is opening an office in Abu Dhabi; and more in this week's banking news roundup.
Earned wage access provider EarnIn, which historically has been known for direct-to-consumer EWA, is now integrating its services with payroll providers. The move comes as consumer advocate groups step up efforts for stricter regulation of the industry.
