Receiving Wide Coverage ...
Leveraging Up: Regulators are slated to finalize a new rule on Tuesday mandating the amount of loss-absorbing capital big banks must hold on their books. Banking agencies last summer proposed raising the leverage ratio to 5% for bank holding companies and 6% for their insured subsidiaries. Those figures are expected to hold steady at the final vote, though how the ratio is calculated could be fine-tuned. Wall Street Journal, Financial Times, American Banker
Hitting the CLO Pause Button: Banking regulators are giving institutions two additional years, until 2017, to make sure their collateralized loan obligations are in line with the Volcker Rule. Industry stakeholders and some lawmakers have warned that banks will have to sell off billions in CLO holdings to comply with the rule and many of those same advocates expressed disappointment on Monday when regulators issued their decision, saying an extension falls short of mending the problem. Wall Street Journal, Financial Times, American Banker
Wall Street Journal
More bad news for Citi. The bank is telling investors that it could miss a key profit target for 2015, return on tangible common equity, after the Federal Reserve rejected its capital plan last month. Heard on the Street's David Reilly notes that absent the bank's plan to return $7 billion to shareholders this year and next, the bank will have to increase profits by at least 10% each year to hit the target, compared with 6%, had the capital plan been approved.
Illinois Attorney General Lisa Madigan filed a lawsuit Monday against a middleman for payday lenders, the latest in a series of crackdowns on the industry. MoneyMutual, a so-called lead generator, collects consumer information and sells it to payday firms that make the loans. The complaint alleges that the company is operating as an unlicensed lender in the state by arranging loans that violate consumer laws limiting fees against borrowers.
A major European Union agreement coordinating the handling of bank failures is in danger of faltering over restrictions on when a member country can intervene to rescue a struggling bank.
Citigroup has agreed to a $1.1 billion settlement with institutional investors over repurchase claims on more than $59 billion in mortgage-backed securities bundled in the lead-up to the financial crisis.
New York's financial regulator Benjamin Lawsky has reportedly opened his own probe into ongoing concerns that Credit Suisse helped clients evade taxes and misled regulators.