Wall Street Journal

Enough with the big bank-small bank divide, says First National Bank of Dennison chairman and chief executive Blair Hillyer. Competition between differently sized banks is better for customer experience and better for business, he says. It's difficult when all banks are operating "with Washington as our co-CEO," but nevertheless it is important "to work together if we're going to remain relevant in this brave, new financial world." His comments came in a letter to the editor, in response to JPMorgan Chase chief Jamie Dimon calling Camden Fine, president and CEO of the Independent Community Bankers of America, "a jerk" on national television. Dimon's comments came after Fine dismissed a call by the JPM chief for banks of all sizes to work together. On Friday Fine addressed the television insult in a BankThink piece.

Financial Times

U.S. bank branches are recording a sharp decline in the number of in-person transactions they process with the rise of mobile and digital banking, but banks aren't aggressively closing them just yet. Brick-and-mortar branch presence has fallen just 3% since 2009, despite in-branch transactions – including transferring funds, cashing checks, or withdrawing cash – having dropped more than a third in the same period. Nevertheless, bankers say branches are still functional and important to business, as more than 90% of customers open accounts inside branches. Brett King, founder of mobile finance app Moven, points out that banks can be tied to their branches' leases for as long as a decade and predicts a "massive decline" is on its way. "We'll go down to half the branches we have today by 2025," he said.

Peer-to-peer lenders' threat to banks won't live up to its hype, according to Deloitte. A report focusing on British banks says they'll continue to dominate the $868 billion loan market in the next 10 years, and marketplace lenders like Zopa will account for just 6% of it. "We do not see [P2P] as a major threat to banks in the mass market," said Neil Tomlinson, head of U.K. banking at Deloitte. "Whilst banks are yet to replicate the benefits of the [P2P] model, we believe it is only a matter of time before they use their size and scale to overtake and sustainably underprice [P2P sites]."

New York Times

A sort of "technology-enabled leaderless collective" is making news after raising the equivalent of $152 million in the largest crowdfunding to date. The DAO, which stands for Decentralized Autonomous Organization, is a company with no human executives, no legal structure and no central server; it's set up on smart contract code that organizes relationships and is built on a public blockchain. The company can be likened to a crowdfunding-venture capital hybrid, in which anyone can invest money in the form of ether (the digital currency of the Ethereum blockchain, on which the DAO runs) in exchange for tokens that represent voting power. Later, the "investors" vote on other blockchain-based ventures to fund. "Of course this venture is fraught with risks," said Christoph Jentzsch, the German programmer who wrote the code. He also said he believes the DAO's structure allows him to dodge any legal liability, if things come to that. The jury's still out on the legality of the operation, however, as many questions remain about whether or not the tokens constitute equity, who is considered the issuer of a maybe-security and who would be held liable for losses, among other things. An earlier story by American Banker delves into these issues. Read it here.

This month marks 20 years since the infamous "Boom-Boom Room" suit, and while conditions have improved in some ways for women on Wall Street, there's a long road to true gender equality. "You may no longer have strippers coming for afternoon entertainment, but that doesn't mean you are treated as an equal," said Anne C. Vladeck of the New York employment law firm Vladeck, Raskin & Clark. "It's not quite as blatant as what went on in the boom-boom room, but it's still there in a way that makes it very hard for women to succeed. Companies on Wall Street are just not changing." Smith Barney paid $150 million to settle a class action brought by 23 female employees claiming rampant sexual harassment and pay discrimination in 1996. About 2,000 more women joined the case to bring light to the industry's testosterone-driven culture. More and more women are joining banks' senior ranks today but there's still an undeniable gender imbalance at the top and complaints remain about pay and promotion disparities and ability to seek damages in court.

Elsewhere ...

New Statesman: As interest for blockchain technology's financial services applications grows, a young organization wants to use it to focus on the world's financially underserved. John Edge, an engineer and former JPMorgan trader, now leads ID2020, a nonprofit already backed by PwC, whose mission is to find solutions that would give digital identity to the 1.5 billion people of the world who will lack access to any proof of identity by 2020. It became clear at the organization's inaugural summit, held Friday at United Nations Headquarters in New York, attended by American Banker, that blockchain technology could play a significant role in the endeavor (Edge has also said solutions will likely come out of a combination of mobile devices, blockchain and artificial intelligence, but that it isn't for him to decide). Edge has acknowledged potential concerns that come with corporate involvement, many of which were addressed Friday among finance, technology and humanitarian leaders. More than anything discussions were deeply philosophical. It seems the first hurdle to achieving ID2020's goal is to distinguish between identity and identification and whether government, corporations or individuals decide legitimacy.

The Straits Times: McKinsey estimates that in consumer finance, mortgages, small and medium-sized enterprise lending, retail payments and wealth management, about 10% to 40% of revenues will be at risk by 2025, and between 20% and 60% of profits. Some of the most futuristic sounding innovations in fintech may not be recognizable to their users today. As soon as banks and businesses begin to effectively partner and collaborate with the relevant technology firms on mobility, big data, social media and cloud computing, the closer we'll be to the future. Most financial institutions are exploring fintech internally as well as through external partnerships. This article out of Singapore, a leading global fintech hub, gives an overview of the state of fintech invading financial services today, and why it's not a stretch to say Singapore's financial industry could look completely different in 10 years.

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