Receiving Wide Coverage ...
Fed Watch: The financial world is on tenterhooks over the outcome of today’s Federal Open Market Committee meeting. Some of Wall Street’s most prominent leaders are betting the Federal Reserve will opt to hold off raising short-term interest rates, according to the Wall Street Journal. “I wouldn’t do it,” Goldman Sachs chief executive Lloyd Blankfein tells the paper, citing subpar wage growth and inflation rates as factors likely to delay a rate increase. Former Treasury Secretary Lawrence Summers and investor Warren Buffet have also vocally opposed a rate hike. MetLife chief Steve Kandarian doesn’t offer an opinion about what he thinks the Fed should do, but he does say he thinks the central bank will avoid increasing rates for now.
Meanwhile, the New York Times tries to get inside the mind of Fed chair Janet Yellen in advance of the meeting — a difficult task, given that she’s kept mum in public since July. And another Journal article argues banks would be the primary beneficiaries of a rate hike. Past rate increases show savers often fail to get much of a bump in deposit rates, while interest rates on loans go on the upswing straight away. On the other hand, former community bank chief Peyton Patterson argues in a recent American Banker op-ed that stiff competition and consumer expectations may push banks to raise deposit interest rates sooner than they expect.
Basel Progress Report: Global banks are making headway toward meeting the standards set by the liquidity coverage ratio, but there’s still more work to be done, according to a report from the Basel Committee of Banking Supervision. The Journal’s Paul J. Davies highlights concerns about big banks’ leverage and exposure to government debt, while the Financial Times notes the world’s 200 biggest banks still need another €147 billion in safe assets to hit liquidity rules that take effect in 2019.
Wall Street Journal
Financial software company Intuit is getting into the lending game. Intuit plans to team up with small-business marketplace lender OnDeck “to create a $100 million fund to provide loans to users of its Quickbooks accounting software,” according to the paper. Intuit isn’t the only tech firm to leverage its financial data as a way to get a piece of the lending pie: PayPal and Square are also expanding into small-business financing.
Financial Times
Does Wall Street’s new instant-messaging service Symphony stand a chance against Bloomberg terminals? John Gapper thinks it just might. He argues Symphony hasn’t positioned itself as a direct competitor so much as a cheaper “Wall Street app store.” That should mean Symphony can attract users without dethroning the terminals completely, he says.
New York Times
The battle over whether Bank of America chief executive Brian Moynihan should be allowed to stay in his dual role as board chair “illustrates how the byzantine world of corporate governance can consume the time and attention of a company’s leadership,” according to the paper. This was supposed to be the year that B of A could concentrate the big picture, having moved on from its post-crisis onslaught of legal and regulatory woes, the articles suggests. Instead, leaders are devoting their energy to the shareholders unhappy with the board’s choice to override their 2009 vote to split the chairman and CEO roles.
New York’s chief deputy attorney general is heading back to the private sector. Harlan Levy is heading back to his old employer, the law firm Boies, Schiller & Flexner, the paper reports. Levy was a driving force behind an investigation that “resulted in banks’ paying $60 billion in fines for selling flawed mortgage-backed securities in the run-up to the financial crisis,” the paper reports.
Elsewhere ...
Atlanta Business Journal: A phishing scam cost Atlanta-based Bitcoin payment processor Bitpay $1.8 million, according to the Atlanta Business Journal. A hacker tricked Bitpay’s chief financial officer Bryan Krohn into turning over the credentials for his workplace email account and used Krohn’s email to order fraudulent transfers of 5,000 bitcoins. Bitpay is now suing its insurer in an attempt to get it to cover its $950,000 claim.
