Editor's note: Morning Scan will publish next on Jan. 4, 2016. Happy holidays and happy new year from all of us at American Banker and SourceMedia.

Wall Street Journal

Christmas came early for foreign banks this year, thanks to the Federal Reserve. This year, units of foreign banks raked in around $6.25 billion in interest on the reserves they store with the central bank. Because of the Fed rate hike, these interest payments will double. The prospective income foreign banks will receive reflects well on their pro-Fed strategy – despite controlling only roughly 15% of all bank assets in the country, foreign banks accounted for at least 35% of the Fed's total reserves as of June 30. That figure is now even higher – during the week ending Dec. 2, the share was nearly 50%. Of course, a factor that's allowed foreign banks to employ this lucrative strategy is that most of these banks don't pay FDIC fees, the article notes.

A Washington state company has developed a compliance program aimed at banks looking to serve marijuana customers without violating state and federal laws. PayQwick, which is licensed as a money transmitter by Washington's Department of Financial Institutions, has developed its compliance program so customers meet the rules laid out in the state's recreational marijuana law, known as I-502. The program assesses Bank Secrecy Act and anti-money laundering compliance, as well as know-your-customer and transaction due diligence. PayQwick also issues cards to each client to reduce cash transactions that raise the specter of money laundering. The company also reviews each business in person to ensure they are adhering to the state's laws.

Financial Times

You can expect oil prices to show up on next year's stress tests. OPEC has lowered its long-term estimates for oil demand – the group now believes the price of crude will not return to $100 per barrel until 2040 at the earliest. As it stands now, oil prices are 55% less than what they were when stress tests were set for last year back in October 2014. And regulators have cautioned that the number of oil and gas loans in danger of default has multiplied five times over the past year. Consequently, this will add pressure to the large swath of U.S. banks that have loans to oil producers and explorations companies on their books – and makes it all the more likely that oil prices will become a bigger feature in future stress test rounds.

New York Times

Some banks are coming under fire for not accepting as identification New York City's new municipal IDs, which were designed in part to make it easier for residents to open banks accounts. Since the program started in January, 670,000 residents have acquired the cards, which have received the stamp of approval from federal banking regulators including the Federal Reserve, the Treasury Department and the Office of Comptroller of the Currency – though the regulators did not go so far as to require their acceptance. Some smaller banks accept the cards, known as IDNYC, as a primary form of identification, but the likes of JPMorgan Chase, Bank of America and Citigroup do not, according to the paper. These big banks have rejected the cards – either as a primary proof of identification or altogether – due to risk assessment concerns. New York Mayor Bill de Blasio has said he plans to talk with the banks to see if they'll reconsider. In the meantime, advocates for thousands of unbanked New York residents say the refusal to accept these IDs is yet another tactic preventing greater access to financial services.

In an op-ed, Democratic presidential candidate Sen. Bernie Sanders, I-Vt., argues that in order to rein in Wall Street the country must reform the Fed. Sanders points to the Fed's choice to raise interest rates as proof of the need for reform, saying the move demonstrates how the Fed listens to concerns big banks have about inflation while it ignores the negative consequences the action could have on small businesses in need of loans. Part of the problem, he argues, is executives from big banks are allowed to sit on Fed's boards, which creates a conflict of interest that in his opinion would not pass muster at other agencies. He says he wants the Fed's governance system retooled to eliminate such concerns, establishing a process by which board members are nominated by the president and approved by the Senate. Banking executives, of course, would be barred from serving as board members. Sanders also calls for the reinstatement of Glass-Steagall, greater transparency and increased lending to creditworthy small businesses and consumers.

Elsewhere ...

The Star-Tribune: Wells Fargo's planned signs in Minneapolis may shine a bit too bright – at least according to the Minnesota Vikings. The National Football League team sued Wells Fargo over the planned ads the bank wants to install atop two office towers adjacent to the team's stadium. The Vikings say the signs would violate a 2014 agreement that signs could not be mounted or illuminated. The lawsuit has also become a bank branding battle: U.S. Bank holds naming rights to the stadium, with its name appearing on a massive sign adorning the facility. With the Super Bowl set to be played there in 2018, not to mention the countless other games televised in the interim, shots of the stadium with Wells Fargo's signs in the background could amount to cheap publicity. Nonetheless, this isn't the first time this year Wells Fargo has squared off with a professional sports team over branding, as American Banker has reported.

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