Receiving Wide Coverage ...
Back in Action: Bank of New York Mellon staffers could probably use a nap right about now. The Wall Street Journal reports employees worked through the night to update pricing on mutual and exchange-traded funds, putting an end to the problems that began with a software glitch at the bank's vendor SunGard a week ago. The fund valuations at 46 companies were thrown off by a software update gone awry, according to the paper. As you may recall, a software update also caused the New York Stock Exchange's temporary blackout in July. Nobody update anything! (No, that's terrible advice.)
The Financial Times notes mutual fund companies will now have to figure out how many customer trades need to be reprocessed as a result of the system breakdown at BNY Mellon. Meanwhile, CNNMoney observes the timing of the glitch was bad luck for funds already rocked by market turmoil. "It's probably the worst week to have this happen given the market volatility," Kevin Kelly, chief investment officer of Recon Capital Partners, tells the publication.
Wall Street Journal
Looks like there's growing shareholder opposition to letting Bank of America chief executive Brian Moynihan do double duty as chairman. The paper reports two big public pension funds, California Public Employees' Retirement System and California State Teachers' Retirement System, plan to vote against the change to the bank's bylaws at the special meeting on Sept. 22.
The paper suggests a government crackdown on discriminatory auto lending practices is driving up loan costs "for some borrowers." This assertion, it turns out, specifically concerns changes to Honda's pricing plan. Honda's new rate structure lowers the cap on the interest-rate markup left to dealers' discretion but raises the wholesale rate on car loans. However, the paper also says Honda's new structure may result in cheaper loans for "borrowers who are getting a lower dealer markup now compared with what they would have received before the change." The Consumer Financial Protection Bureau says Honda's changes will help prevent discrimination. The paper is unable to point to other lenders that have raised borrowing costs as a direct result of the CFPB crackdown. BB&T Corp. replaced its variable dealer markup with a flat fee, but there's no evidence the company was the subject of a government probe.
Fannie and Freddie investors got their hopes up over recent speculation the Obama administration is gearing up to settle lawsuits over the government sweep of the housing giants' profits. John Carney rains on their parade.
Recent volatility in emerging markets makes plain the need for countries like China and India to take action in order to avert a crisis, according to the paper. The article suggests greater fiscal spending could drive growth in some economies, while others need to pass "urgent structural reforms to cut bureaucracy, boost the private sectors' role in the economy and provide incentives for employers."
New York Times
Andrew Ross Sorkin has a roundup of the best business books to read in the waning days of summer, including Ashlee Vance's book on space-obsessed entrepreneur Elon Musk, a biography of 15th-century tycoon Jacob Fugger and venture capitalist Peter Thiel's treatise on startups.
A Wharton School professor of legal studies conducted a review of every decision issued by the Securities and Exchange Commission's administrative law judges since 2010 in order to determine whether their decisions are unfairly biased in favor of the agency. He concludes that while the in-house judges tend to rule in favor of the agency, the record suggests defendants have a fighting chance.
Three potential buyers are elbowing for a chance to snap up GE Capital's Australian commercial lending and leasing business. The contenders are Lone Star, Sankaty Advisors and HNA Group of China, according to an anonymouse.
Bloomberg: Bloomberg has a lengthy feature on Blythe Masters, the former JPMorgan Chase executive who's now hawking the power of the blockchain to bankers. There's plenty of material on both the industry's growing interest in distributed ledgers and on Masters, who serves as chief executive of the blockchain technology startup Digital Asset Holdings. The article also draws a connection between Masters' interest in Bitcoin technology and her role as the creator of credit-default swaps. Her ties with credit derivatives earned her the title of "The Woman Who Built Financial Weapons of Mass Destruction" in the aftermath of the 2008 crisis.