Receiving Wide Coverage ...
Emerging Markets Strained: The papers continue to raise concerns about emerging markets and foreign currencies as investors have pulled billions of dollars out of emerging market stocks and bonds since last week. The Journal says the euro hit its weakest level in 10 days "as expectations mounted that the European Central Bank will have to introduce fresh easing measures to head off the threat of falling prices." The FT says it could become a contagion to economies in other areas including Argentina, South Africa, Turkey and Russia. The Journal focused its concerns on Hungary. But the papers report that central bankers are heavily defending their currencies even though "their efforts have" fallen short with investors, particularly after Turkey's central bank raised rates this week. The FT reports that some of the "biggest losers" in the emerging market bond fallout are Franklin Templeton, Ashmore and First State, according to sources familiar with the matter. The paper separately raises concerns about BBVA's earnings, saying investors could fear "the bank's heavy exposure to emerging markets" despite the bank reporting higher income.
Goldman's CEO Hits Jackpot: Goldman Sachs Group chief executive Lloyd Blankfein caught media attention for his $23 million salary and bonus package, up nearly 10% from 2012. The Journal says it was Blankfein's "highest payday since the financial crisis." And the FT notes he's on track to make more than the chief executives of JPMorgan and Morgan Stanley. Still, the Times argues that it's "a far cry" from the payday boon years before the financial crisis, when Blankfein's 2007 earnings reached $68.5 million.
Wall Street Journal
The Journal had an interesting profile of a businessman named Michael Benanti, who's garnered a captive audience by helping prisoners establish bank accounts and credit. Though Benanti says it may help reduce the number of repeat offenders, the Journal says many prison officials "worry it could become a conduit for funding crimes and smuggling contraband, among other issues."
Underwriting standards at the nation's largest banks eased up last year, according to the annual survey by the Office of the Comptroller of the Currency. Of course, standards were less tight for the 18 months leading up to June 30 compared to the prior period when credit was practically frozen. So it's now more of a thawing, as characterized by the Journal. But American Banker notes that the report does not reflect the new mortgage rules that just kicked off in January which bankers argue could tighten credit further.
European banks are gearing up for a round of capital stress tests but the FT says that staffing for the job will be much harder for European Banks than for those in the U.S. The paper separately reports that sovereign bonds will also be involved in the testing amid emerging market concerns but supervisors can use discretion when filtering out certain adverse effects.
The FT reports that the U.S. government is seeking $2.1 billion in penalties from Bank of America for allegedly selling bad mortgages to Fannie Mae and Freddie Mac. "The request comes as a blow to the bank as the government has more than doubled its earlier demand of about $860m," the FT says.
New York Times
The Times reports that Mary L. Schapiro, the former head of the Securities and Exchange Commission, is leaving Promontory Financial Group after just nine months of working at the major financial consulting firm. "Promontory is a great firm but I've learned over the last nine months that there are lots of things I'm interested in doing and this move frees me up to do them," Schapiro told the Times. She will stay on as vice chairwoman of Promontory's advisory board.
Stefan Ingves, who leads the Basel Committee on Bank Supervision, hinted in an interview with the Times this week that the committee could consider tougher capital requirements.