Receiving Wide Coverage ...
Quitting Time: Standard Chartered is getting out of the institutional equities business, and analysts seem to agree the U.K.-based bank is making the right call. Its equity sales and research units was "unprofitable," according to the papers, and shutting them down will save the bank $100 million. Investors have been calling on Standard Chartered to restructure in order to boost earnings; the Financial Times' Lex team suggests that paring down the bank's operations "will allow management to refocus on its strengths in more traditional trade financing and wholesale lending." Workers in the axed units appeared to be taken aback by their employer's sudden decision, according to both the Wall Street Journal and the FT. Standard Chartered also plans to cut 2,000 jobs from its retail bank over the course of 2015, primarily by not replacing employees who leave. Wall Street Journal, Financial Times, New York Times
Wall Street Journal
The Federal Reserve generally minds its own beeswax when it comes to foreign monetary policy, but a slump in global growth has prompted the Fed to pipe up. Minutes from the Fed's December meeting reveal that officials are especially concerned about how the European Central Bank will respond to deflation. "The references, though subtle, amounted to a warningparticularly to the ECBthat markets and the global economy more broadly could respond negatively if foreign policy makers don't deliver on expectations for action," the paper reports.
House Republicans have hit a stumbling block in their efforts to chip away at Dodd-Frank. Democrats defeated a bill that would have given banks an extra two years to sell their stakes in collateralized loan obligations, as required under the Volcker Rule. A reworked version of the bill, which contains a number of less controversial provisions easing Dodd-Frank requirements, appears likely to resurface.
Homeowners may want to seize the chance to refinance now as mortgage interest rates head south, according to the paper. With the Federal Reserve expected to raise rates later this year, the paper suggests the window of opportunity may close soon.
Deutsche Bank is beefing up its back office in the U.S. as it prepares to deal with new regulations. The bank has hired Barry Massaro away from HSBC to serve as director of finance for its broker-dealer unit and appointed Mary Chen-Eng to oversee the bank's efforts to create a separate legal entity as required by the Federal Reserve.
If regulators want to break up the world's biggest banks without waiting around for their government's say-so, that's pretty awesome, according to the paper's John Gapper. He says imposing stricter capital requirements on the largest institutions is a good place to start. Gapper is particularly focused on the benefits of slimming down JPMorgan Chase in light of Goldman Sachs analysts' recent report championing the idea.
New York Times
Keep your friends close and your frenemies closer. That's the motto traditional financial companies seem to be embracing as tech startups move in on their turf. MasterCard has teamed up with alternative small business lender Behalf, along with wearable tech firm Nymi and biometric card company Zwipe, and a number of other major companies are also forging alliances with so-called disruptors.
The Financial Industry Regulatory Authority plans to conduct a review of electronic bond trading this year. "Richard G. Ketchum, Finra's chief executive, said the review was motivated by broad changes in the bond market," the paper reports. "Partly in response to new regulations, bond dealers are holding less inventory, pushing more trading to various intermediaries."
Companies that unreservedly embrace big data put Americans' privacy at risk, according to a speech by Federal Trade Commission chairwoman Edith Ramirez. "We often hear the argument that to realize the benefits of big data, businesses should not face limits on the collection and retention of data because the value lies in its unanticipated uses," Ramirez said in the speech. "But I question the notion that we must put sensitive consumer data at risk on the off-chance a company might someday discover a valuable use for the information."