Clayton confirmed; Dodd-Frank Rollback vote coming

Receiving Wide Coverage ...

Clayton confirmed: By a vote of 61-37, the Senate confirmed Jay Clayton to lead the Securities and Exchange Commission. Clayton, a Wall Street lawyer, enters office "without a checklist of regulations mandated by Congress, which passed sweeping legislation in 2010 that pinned down the SEC with an abundance of directives both audacious and picayune," the Wall Street Journal said. Wall Street Journal, Washington Post

Big stake: Chinese conglomerate HNA Group has become Deutsche Bank's biggest shareholder, increasing its stake to almost 10%. The company, which has a portfolio of hotel and airline stakes, has said its investment in DB is passive, although the New York Times describes HNA as a "secretive Chinese conglomerate with ties to the Communist Party in Beijing." Wall Street Journal, Financial Times, New York Times

Wall Street Journal

Let's vote: The House Financial Services Committee is expected to vote Wednesday on the Financial Choice Act, which would overhaul much of the 2010 Dodd-Frank law and undo many of the financial regulations put in place after the global financial crisis. The measure is expected to meet stiff Democrat opposition.

"For all the rhetoric we hear from the other side about how Dodd-Frank is supposed to be a consumer protection law, the reality is with Dodd-Frank, consumers are paying more and getting less," said committee chairman Jeb Hensarling, R-Texas, who introduced the bill.

Unintended consequences: The Durbin amendment to Dodd-Frank hasn't worked out the way its sponsor, Sen. Richard Durbin, D-Ill., promised, Todd J. Zywicki and Julian Morris – respectively, the executive director of the Law and Economics Center at George Mason University's Antonin Scalia Law School and vice president of research at the Reason Foundation – argue in an op-ed. The solution they say is repeal the amendment, which limits how much banks can charge retailers for debit card transactions. "While big-box retailers and their shareholders have managed to pocket more than $40 billion in cost savings so far, most Main Street businesses and the poorest American households have suffered," they write.

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Going out with a bang: Camden Fine is retiring next year after 15 years as CEO of the Independent Community Bankers of America. He will be succeeded by Rebeca Romero Rainey, a community banker from Taos, N.M. Fine said he planned to go "full throttle" before stepping aside on May 5, 2018. Rainey is the immediate past chairman of the ICBA.

On Monday, President Trump told about 100 members of the ICBA that rolling back financial regulations passed following the financial crisis is among his administration's top economic priorities.

Inside view: The lawsuit brought by the Lehman Brothers bankruptcy estate over $2 billion of deposits held by Citigroup, now being heard in U.S. Bankruptcy Court in Manhattan, "is expected to give a glimpse at how employees at Citigroup responded to the fall of Lehman and offers a look at how traders go about their business." Lehman contends the bank cooked up a bankruptcy claim in order to keep the money.

New job: Mark Tsesarsky, a 31-year Citigroup veteran, has been named the co-head of fixed income and commodities at Millennium Management, the $35 billion hedge fund. Tsesarsky replaces Michael Gelband, who left the firm earlier this year despite being viewed as the heir apparent to CEO Israel Englander. At Citigroup, Tsesarsky was a managing director of securitizations.

Financial Times

Oiled up: Writing in his monthly blog, former U.S. Treasury Secretary Larry Summers says fintech is "likely to make a substantial contribution by removing frictions. Policymakers should be slow to accede to demands from incumbents for heavy regulation of new fintech entrants. At the same time, they should ensure that when fintech companies succeed, it is on the basis of genuine efficiencies, not because of regulatory avoidance."

Retaliation: KKR is blocking Barclays from winning new investment banking assignments to protest CEO Jes Staley taking the side of his brother-in-law against the big American private equity firm in a dispute over a failed Brazilian deal. "The spat comes at an awkward time for Jes Staley, potentially raising further questions about the judgment of the Barclays boss, who is separately being investigated by regulators for trying to uncover the identity of a whistleblower," the paper commented.

Elsewhere

Surging: Bitcoin rose to an all-time high of $1,437 on Tuesday. The digital currency has gained 200% in the past year.

Quotable ...

"Hope is not a good trading strategy." – Brian Archer, head of global credit trading at Citigroup