Receiving Wide Coverage ...
A Deluge of EU News: You can tell that a U.S. holiday weekend is on the horizon as Monday's news is largely coming from overseas. Reuters reports that EU regulators have charged Markit, the International Swaps and Derivatives Association and 13 banks with breaching anti-trust rules by blocking rival exchanges in the credit derivatives business. The banks include Bank of America Merrill Lynch, Citigroup, Morgan Stanley, Goldman Sachs, HSBC and JPMorgan. Elsewhere, this FT op-ed criticizes the EU's failure to get its banking union, off the ground despite agreeing on rules to force losses on creditors in failed banks. "In theory, a bail-in rule should shift some of the financial burden away from the bank's home state. But this only works to the extent that some of those shareholders and bondholders are foreigners," writes columnist Wolfgang Munchau. "The trouble is that the banks have become more national since the crisis." And for those paying attention to the ongoing U.S. spying story, the Wall Street Journal and the FT report the National Security Agency has been accused of spying on European Union officials after a German magazine over the weekend cited secret documents obtained by former NSA contractor Eric Snowden.
Carney Steps In: Today is Canadian Mark Carney's first day as governor of the Bank of England and he's been greeted by some good economic data. "Manufacturing activity picked up in June and approvals for home loans hit a 3½-year high in May," the Journal reports. Analysts say the data is likely to preclude the central bank from adding extra stimulus this month, but Carney's problems are far from solved. "Sluggish demand for goods from the troubled euro zone, Britain's largest export market, is keeping many companies from investing in new machinery or hiring staff," the Times notes in a curtain-raiser to Carney's first day on the job. "And the austerity measures prescribed by George Osborne which are likely to continue through 2018, much longer than initially planned have squeezed disposable income as consumer prices keep rising. At the beginning of the year, Britain barely avoided a triple-dip recession." So, in other words, no pressure.
Peter Sands, Group CEO of Standard Chartered, urges banks (and regulators) to step up the pace regarding technology-driven innovation in this op-ed. "Too much of the debate about banking is about not repeating the mistakes of the past," he writes. "We risk missing the opportunity to make banks much better in the future."
Barclays chief executive Antony Jenkins told investors the bank may have to cut back on lending if U.K. regulators push forward with plans to include a stricter leverage ratio in capital plans. The statement was almost immediately met with some angry words from former U.K. regulator Robert Jenkins. "Was this meant as a threat? Was it hubris, reflex or just plain stupidity?," he asked rhetorically in a letter to the FT. "Is this the new Barclays?"
New York Times
Steve A. Cohen has formally declined to testify before a grand jury during the government's insider trading investigation into his hedge fund SAC Capital Advisors.
This article looks at employers' growing inclination to load workers' wages onto prepaid cards. The trend is leading many low-paid workers to pay high fees to access their cash. Some card issuers argue the fees are lower than those charged by check-cashing services and also say the cards are a good way to bank the underbanked. But a big part of the problem is that workers are increasingly not being given a say in how they get their wages. "At companies where there is a choice, it is often more in theory than in practice," the article notes. "Employees say they are often automatically enrolled in the payroll card programs and confronted with a pile of paperwork if they want to opt out."
Suggestions Wanted: What books should be on every banker's 2013 Summer Reading list? Email your favorites to BankThink Deputy Editor Jeanine Skowronski at Jeanine.firstname.lastname@example.org for inclusion in our annual slideshow.