Receiving Wide Coverage ...
You're No Alibaba: Royal Bank of Scotland cut the price on the IPO of its U.S. banking unit, Citizens Financial, amid tepid demand. The FT said investors are worried that RBS won't be able to deliver on its financial promises for Citizens. Even so, the Citizens IPO was much larger than other recent bank IPOs, including Talmer Bancorp, the Journal noted. Overall the market for bank IPOs has been lackluster this year, especially in comparison to Alibaba, the FT and WSJ both said.
Wall Street Journal
The Home Depot data breach is having ripple effects, as additional banks are discovering fraudulent activity such as taking cash out of customers' accounts, the Journal reports, citing anonymous sources. Criminals are using stolen account information to buy prepaid cards, conusmer electronics, groceries and more. Some of the fraud may not necessarily be traced to Home Depot, but to some other recent retailer data breaches, including Target. JPMorgan Chase and Capital One have issued new cards to customers whose data was compromised in the Home Depot breach. But other lenders are waiting to see if fraud occurs on a customer's account before issuing a new card.
A participant in an insider-trading ring who was apprehended last week worked as a mortgage lender for Citigroup in midtown Manhattan. Frank Tamayo surrendered to the FBI last week.
Banks that ignore the Fed's guidance on leveraged lending will do so at their own risk, as the Fed plans to retaliate against those institutions with higher capital requirements in the upcoming round of stress tests, an anonymous sources tell the FT. The Fed has already begun to warn banks about this potential outcome. The Fed, FDIC and OCC issued their leveraged lending guidance in March 2013 and while some banks started adjusting their underwriting in response to the guidance. "But regulators have been frustrated that banks have not taken the lending guidance more seriously," the FT said, without attributing that statement to anyone.
A group of companies, none named, has formed a not-for-profit organization to fight cyber attacks by encouraging the sharing of information. The group was formed as a joint venture between Financial Services Information Sharing and Analysis Center, or FS-ISAC, and Depository Trust and Clearing Corp. The venture, called Soltra, will provide a software platform for banks and companies from other industries to trade intelligence on hacks.
The World Bank and other so-called supranational financial organizations have raised about $219 billion on global debt markets this year, the largest amount since records started being kept. Part of the reason for the surge is the amount that was raised for European bail-outs. But the amount is up also because of the demand for high-quality bonds.
New York Times
Bankers' greatest fear may soon be realized: Wal-Mart is launching a bank. Well, it's not quite a bank, but it's really close. The Times reports that Wal-Mart will soon offer checking accounts to "almost anyone over 18 who passes an ID check." Wal-Mart is launching the product in partnership with Green Dot. The checking accounts won't carry fees for overdrafts and won't require a minimum balance. Wal-Mart and Green Dot plan to use a proprietary system to vet potential customers, eschewing the screening system that most banks use. The Times article skirts by the issue of whether Wal-Mart's checking account product would pass regulatory muster, simply saying "the retailer has assembled an array of services that could be offered without a charter."