Editor's note: Morning Scan will publish next on Dec. 29. Happy holidays from all of us at American Banker and SourceMedia.

Receiving Wide Coverage ...

Investors Worry About Ocwen: Ocwen Financial's legal settlement with New York state banking regulator Benjamin Lawsky led to a sharp drop in its share price on Monday, as investors expressed concern about the company's ability to move past the settlement's onerous terms. Among those terms: William Erbey will step down as chairman of Ocwen, and as CEO of four of its subsidiaries; a full-time monitor will be placed inside Ocwen for three years to make certain it's following the requirements of the settlement; and Ocwen must pay $150 million in restitution, including payments of $10,000 each to borrowers whose houses were foreclosed on by Ocwen, dating back to January 2009. Ocwen also agreed to admit that it did not properly deal with distressed homeowners and may have levied unnecessary fees on them. Further, Ocwen acknowledged that it did not maintain adequate systems for servicing the hundreds of billions of dollars of mortgages in its portfolios. Ocwen's settlement agreement will saddle the company with a "number of changes that in the end, will create a more compliant (dare we say complacent) company, but cripple profitability for some time," analysts at Sterne Agee wrote. The biggest concern may be the loss of Erbey himself; an analyst at Compass Point Research and Trading described Erbey as "the main architect of the [Ocwen] corporate structure we see today."

Wall Street Journal

As Citigroup deals with financial concerns with its ownership of physical metals stored at Chinese ports, and the potential for big losses, Goldman Sachs has decided to sell its own aluminum-warehousing business. Lawmakers and regulators have been cracking down on banks' ownership of physical commodities.

Financial Times

The paper looks at whether this year's rise in the price of shares of the six largest U.S. banks has been overdone. (Shares in each of those banks has risen by a third this year.) The main factors that will determine if investors were too optimistic are: whether interest rates rise in 2015; if disruptors like Apple Pay take a serious bite out of banks' business; if banks' legal woes start wrapping up; and if the new GOP-led Congress is able to roll back some of the most-onerous banking regulations.

New York Times

A simple fix could have prevented the cyberattack on JPMorgan Chase this summer, anonymous sources tell the paper. JPMorgan failed to install a two-factor authentication scheme on one of its network servers, a protocol that requires users to enter two passwords to gain access; that oversight allowed hackers to get into JPMorgan's network and steal an employee's log-in credentials. The simple flaw may explain why other financial institutions were victimized by the same hackers that breached JPMorgan. Employee turnover at JPMorgan may have been another reason why it was victimized; a number of employees in JPMorgan's cybersecurity division left the company this summer to join payments processor First Data. (Frank Bisignano, First Data's CEO, is a former JPMorgan executive.) The sprawling nature of big banks like JPMorgan, which were created through many acquisitions, may also have been a factor. For example, it's not uncommon for the name "Bank One" to appear in a URL for a JPMorgan business (JPMorgan acquired Bank One in 2004.)

The Times looks at Janet Yellen's first year on the job as Fed chairman. The central bank has "effectively expanded its stimulus campaign" by keeping to its existing plan, despite unemployment falling faster than expected. Yellen has said low rates will not solve all the problems causing high unemployment. She's also not willing to test the theory that higher inflation will lead to stronger economic growth. Jon Faust, a professor at Johns Hopkins University in Baltimore and a former Fed special adviser, said Yellen's tenure thus far is likely not much different than how former Fed Chairman Ben Bernanke would have handled things.

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