Friday, February 10

Receiving Wide Coverage ...

Interpretations of the Mortgage Deal: Depending on which story you read, the $25 billion settlement between the federal government, 49 state attorneys general and the largest mortgage servicers is: A potential boon to the housing market and the economy (Wall Street Journal, Financial Times, Los Angeles Times); a shot across the bow for the banks (Washington Post); a source of limited relief for the banks (“Heard on the Street” in the Journal); already largely reserved for by the banks (Journal again); a source of limited relief for homeowners (New York Times); an egregious shakedown of banks by politicians (Journal editorial page); too soft on the banks and not generous enough to homeowners (Los Angeles Times again, Matt Taibbi in Rolling Stone, Adam Levitin at CreditSlips.org); and/or the denouement of a long-running drama (Journal, Post). And yes, the Journal’s “tick, tock” story reliably tells you what they ate at the negotiating table (cookies this time). A more interesting insider detail is the role played by Wells Fargo executive Mike Heid, who’s profiled, along with the more obvious government figures, in a Journal sidebar on key players in the talks. Heid “helped close ranks and find consensus” among the five megaservicers, the piece says. This was probably quite a feat considering that Wells also argued to the regulators “that it should be treated differently because its mortgage-servicing operation wasn't nearly as troubled as” B of A’s or JPMorgan’s.

Financial Times

Yet another Rategate update: Citigroup lost at least $50 million after unwinding positions taken by two former traders who allegedly pressured other employees to manipulate the Tokyo Interbank Offered Rate, anonymous sources tell the FT. Japan’s financial regulator, so far the only agency to have sanctioned banks in the worldwide probe of suspect gaming benchmark rates, found in December that the Citi traders had tried to influence the Tokyo index.

New York Times

It’s not a great morning for Citi. In addition to the aforementioned trading loss and the dubious distinction of being the only one of the five big banks that had to take a charge for the mortgage settlement, the Times reports that Citi accidentally double-charged users of its mobile-payment app in recent months due a technical bug. TGIF!