Receiving Wide Coverage ... Sad saga: Allan Dunlap, one of the 800,000 Wells Fargo auto loan customers charged for car insurance they didn’t need or ask for, tells the New York Times, “I never missed a payment and I always had insurance. But they forced additional coverage on my vehicle and it showed up on my credit report that I was 60 to 90 days late on my payments.” More than a year after starting his battle with the bank, he’s still waiting for confirmation that his credit report has been fixed.
Seperately, Wells Fargo’s new board chairman, former Federal Reserve Gov. Betsy Duke, is profiled by the Financial Times.
Wall Street Journal Settled: Bank of America agreed to pay more than $6 million to settle an eight-year-long dispute with a California couple who a federal judge said had been harassed and illegally foreclosed on by the bank’s mortgage unit. The proposed settlement with Erik and Renee Sundquist would enable the bank to avoid paying an earlier court-ordered $40 million donation to five California law schools and two consumer advocacy groups.
China deal: Massachusetts Mutual agreed to sell its Hong Kong-based unit for about $1.7 billion to a group of Asian investors, including two companies affiliated with Chinese billionaire Jack Ma, the chairman of Alibaba Group. One of those companies, Ant Financial, operates Alipay, the world's largest mobile and online payments platform.
Jack Ma, billionaire and chairman of Alibaba Group Holding Ltd., reacts as he arrives for sessions at the St. Petersburg International Economic Forum (SPIEF) in Saint Petersburg, Russia, on Friday, June 19, 2015. SPIEF is an annual international conference dedicated to economic and business issues which takes place at the Lenexpo exhibition center June 18-20. Photographer: Chris Ratcliffe/Bloomberg *** Local Caption *** Jack Ma
Chris Ratcliffe/Bloomberg
MassMutual will get $1 billion in cash plus a 25% stake in Yunfeng Financial Group, a Hong Kong-listed financial services company the paper says “trades securities, sells investment products and is expanding into the growing financial technology sector.”
Tracing the crisis: In this video, the paper explains “how developments at an obscure French bank in August 2007 sowed the seeds” of the 2008 financial crisis.
Financial Times Road trip: The Federal Deposit Insurance Corp. is suing six large European banks — Barclays, Deutsche Bank, Lloyds, Royal Bank of Scotland, Rabobank and UBS — plus the British Bankers’ Association, for their alleged role in rigging Libor. The FDIC said it brought the suit in a London court on behalf of 39 failed American banks that it claims suffered losses as a result.
That’s rich: Some investors are questioning the profitability of U.S. credit card issuers given the rich rewards they’ve been paying to stay competitive. Mercator Advisory Group expects their return on assets to shrink to 3.5% next year, down from almost 5% in 2014. “You can bring customers in, but at what cost? These rewards become very hard to justify. You have decreasing profitability with this arms race going on,” said Brian Riley, a Mercator director.
Quotable “Chase has become extremely political this year and I must be honest and say that others and myself have taken offense to much of it. [President Trump] condemned all hateful actors, as he should have. I have to see this conflict in my private life. I never thought I would deal with it at my workplace.” — An employee at JPMorgan Chase responding to CEO Jamie Dimon’s memo to bank employees Wednesday about Trump’s reaction to the events in Charlottesville, Va. The bank received more than 500 internal messages and email responses to Dimon’s memo, the vast majority of which supported their boss.
New York's attorney general announces MoneyGram will pay a civil fine to settle a lawsuit over its handling of remittance payments; Swedish buy now/pay later lender Klarna is getting into the telecom business; Truist Financial has hired Charles Alston to lead its new nonprofit hospital, higher education and government banking team; and more in this week's banking news roundup.
Lipkin, who built Valley National Bancorp from a small community bank into a regional institution with 200 branches in four states, passed away this week at age 84.
Financial markets were shaken but not stirred this past spring, according to the Federal Reserve, as swinging stock prices and bond yields did little to bring down elevated asset prices or leverage.
