Receiving Wide Coverage ...
Through the Back Door: Democrats and some Republicans are pushing back against the GOP's effort to repeal a Dodd-Frank derivatives rule by slipping the change into the government spending bill slated for a vote today. Analysis in the New York Times and Wall Street Journal suggests that getting rid of the rule would be a bad idea but not for the obvious reasons. The provision obliges banks to move a small percentage of derivatives trading outside of their retail subsidiaries in order to reduce the banks' implicit subsidies. Banks argue the regulation is made redundant by the Volcker Rule, so the repeal wouldn't make a huge difference. But David Reilly of "Heard on the Street" warns that tucking the change into the spending bill deprives the public of the chance to hear all sides of the issue, and it will therefore "reinforce the notion among the public that Wall Street can't be trusted and will always try to rig the game in its own favor." The Times' Peter Eavis says killing the rule would also take away the chance to find out if such changes can successfully exert market discipline.
Committee vs. Commitment: Standard Chartered Wednesday announced the creation of a committee on its board dedicated to reducing financial crime risk in an attempt to demonstrate it's serious about regulatory compliance. Some observers are skeptical about the bank's commitment to that goal, given that U.S. authorities just extended by another three years the terms of the bank's 2012 deferred-prosecution agreement for sanctions violations. The bank also announced Wednesday that it was adding nine senior executives to its financial crime and compliance unit. Both the Journal and the Financial Times note the move to establish a committee in the face of regulatory crackdowns parallels HSBC's decision to assemble a financial systems vulnerability committee. But only the Journal mentions the HSBC committee is headed by a "former top British spy."
Presenting P2P: Lending Club's initial public offering today doubles as the grand entrance of the entire alternative and peer-to-peer lending industry into public consciousness, according to the Times. Its coverage functions as an introduction to Lending Club and its online peers. The Journal takes a narrower view of the company's stock market debut, including interviews with two people connected to the P2P industry who are buying into IPOs for the first time with Lending Club.
Wall Street Journal
The controversy over whether Treasury undersecretary nominee Antonio Weiss is in Wall Street's clutches "has become a proxy battle for a deepening rift in the Democratic Party over its ties to the financial industry," the Journal reports. The article complements yesterday's American Banker coverage, which connects the populist pushback over Weiss's nomination to the Democratic Party's complicated history with former Treasury Secretary and banking veteran Robert Rubin.
JPMorgan Chase may boost its capital ratio to 11.5% in order to comply with the Federal Reserve's proposed capital surcharges, according to the bank's chief financial officer Marianne Lake. The bank's current minimum capital ratio is 9.5%.
Fannie Mae and Freddie Mac investors must be used to disappointment by now, but they got some more bad news recently when a Treasury official gave a speech that included the line, "The only way to responsibly end the conservatorship is through legislation." Shareholders had been crossing their fingers hoping for the Obama administration to intervene in unloading Fannie and Freddie, but it looks like the decision is up to Congress.
New York Times
The news that digital currency start-up Circle Internet Financial has hired a former JPMorgan executive as its new CFO and corporate treasurer is "an indication that leaders in the traditional financial services industry are now taking digital money seriously," according to the paper. The new hire, Paul Camp, stepped down from his role as head of JPMorgan's global transaction services business in July.
