Receiving Wide Coverage ...
Buffett Pooh-Poohs SIFI Talk: Banking was one of many topics discussed at Berkshire Hathaway's annual meeting in Omaha, Neb., on Saturday. Warren Buffett said it would be a "terrible thing to weaken" Dodd-Frank, and the Federal Reserve and Treasury Department's wide-ranging powers are necessary in order to respond to another large crisis. Buffett also scoffed at the notion that Berkshire Hathaway's insurance operationsGEICO, National Indemnity, Gen Reshould be deemed systemically important, as have its rivals AIG and MetLife. One of Buffett's arguments is Berkshire as a whole does not derive 85% of its revenue from financial services. And, oh by the way, Berkshire did some of its own bailing out of other banks during the financial crisis. "We were about the only party supplying help to the financial system, and we'll always conduct ourselves in a way (where) the problems of others can't hurt us in a significant way," Buffett said. An unsigned op-ed in the FT begs to differ, saying global reinsurance companies should be treated equally and Berkshire's Gen Re shouldn't get a free pass. The Bank of England has questioned the status of Berkshire's insurance operations, suggesting it believes the unit should get SiFi designation.
Wall Street Journal
Mortgage applications are on the rebound, but it's not enough for lenders, according to "Heard on the Street." There aren't enough first-time homebuyers, which suggests the growth is coming mainly from wealthy homeowners trading up to more-expensive houses. Banks and nonbank mortgage lenders need the sub-$150,000 mortgage market to heat up, otherwise homeowners at the lower end of the market who want to move up may find it harder to sell. All this is even more important in the context of the fact that there aren't going to be many more mortgage-refi booms any time soon, if rates rise later this year or early next year.
Financial Times
Barclays hopes to sell about £2 billion of risky mortgages and has been in talks with a number of unidentified banks, unnamed sources said.
New York Times
The Clearing House is working on a "proof of concept" for a blockchain technology its member banks would maintain and use for clearing large payments amongst themselves. The decentralized ledger would operate on the computer systems of large banks and would "eliminate the current risks involving in having billions of dollars in limbo for days at a time," according to the piece in the New York Times magazine. Banks are moving slowly on this project, however, while startups are working on similar projects, according to the article, which is based on Nathaniel Popper's upcoming book, Digital Gold: Bitcoin and the Inside Story of the Misfits and Millionaires Trying to Reinvent Money. Banks may want to move more quickly, or risk being left out. "Oddly enough, American regulators have actually been friendlier than banks toward the new technology. Even before the advent of Bitcoin, the Federal Reserve was looking into ways to update the relatively antiquated American payment networks, which often take two or three days to complete a simple money transfer."
The magazine also has a look at startup company Even, which purports to help people with volatile income swings pay bills during lean months. The Oakland, Calif., firm's app is designed to help those with unpredictable paychecks massage therapists, Lyft drivers, baristas, etc. manage their wild monthly swings through a type of paycheck insurance.
JPMorgan Chase's website was down for several hours on Friday. The bank attributed the outage to higher-than-normal customer use, as it was the final day of the month, an unnamed source said. The outage was not thought to be a result of a cyberattack.
Stephen Lubben, a bankruptcy law professor at Seton Hall University, is surprised regulators have done virtually nothing to pass rules allowing them to develop their "source of strength." Lubben is concerned about the current framework, in which a failed bank would be resolved through the FDIC.
Elsewhere ...
Associated Press: American Express is rolling out a new rewards program today, called Plenti, which will let users earn rewards through different types of purchases, such as buying gas or paying a phone bill. Plenti users don't have to make purchases at a single company and they don't even have to be American Express members.
Fairbanks Daily News-Miner: Mt. McKinley Bank in Fairbanks, Alaska, has named its first woman chief executive and chairwoman. Patty Mongold started at the $360 million-asset bank as a teller at age 17 in 1976, and is currently the longest-serving employee at the community bank. Mongold said she has worked in "almost every department of the bank" and most recently served as chief operating officer.
Columbia Daily Tribune: Central Bancompany in Jefferson City, Mo., is changing the names of 10 its operating banks. Each of the 10 banks will have the phrase "Central Bank of" at the beginning of its name; Empire Bank, for example, will become Central Bank of the Ozarks.
