NSA hacks into SWIFT: The hacker group Shadow Brokers says the U.S. National Security Agency "has penetrated deep into the finance infrastructure of the Middle East" and compromised elements of the global banking system. According to the website Wired, which appears to have reported the news first last Friday, "the NSA hacked into EastNets, a Dubai-based firm that oversees payments in the global SWIFT transaction system for dozens of client banks and other firms, particularly in the Middle East." Shadow Brokers also provided tools to enable people to hack into Microsoft's Windows computer operating system. Wall Street Journal, New York Times, Wired
Show me: Several of the nation's top bankers said many of their business customers are feeling less confident about President Trump's ability to pull off his ambitious agenda to cut taxes and roll back regulations. That is making them hesitant to borrow money in order to invest in their companies, especially now that the Federal Reserve has started to raise interest rates, which will make borrowing more costly.
At the same time, investors in American bank stocks don't know what to make of the Trump Administration's stance on bank regulation, which seems to change by the day, writes Simon Samuels, a banking consultant at Veritum Partners, in the FT. "This news rollercoaster sheds light on how investors tend to answer a fundamental question — should shareholders celebrate or fear more lenient regulators?" he writes. "A watchdog demanding that banks have high levels of capital, for example, makes them safer, which shareholders presumably applaud. Yet this change also makes banks less profitable, which shareholders resent. Should shareholders value the return on their capital more highly than the return of their capital?"
Wall Street Journal
Trouble ahead: With its annual investor meeting rapidly approaching, Wells Fargo faces a possible shareholder revolt against its board of directors as retribution for the bank's phony accounts scandal. The biggest name in the crosshairs is the bank's chairman, Stephen Sanger. "A number of those directors will be vulnerable," one large Wells investor told the Journal. As the April 25 meeting approaches, "bank executives and directors are scrambling to meet with key investors and deal with the possibility that they could see one or more fail to win reelection." According to the Journal, it's rare for directors to be booted off a big company's board. In the past five years, just nine directors of S&P 500 companies have failed to receive majority shareholder support.
Financial Times
Hello, it's me: Lloyds Banking Group became the first financial services provider in the U.K. to enable its customers to use fingerprint and facial recognition to log into their bank accounts. Instead of passwords and PINs, customers will instead be able to use Microsoft's Windows 10 "Hello" service to gain access to their account on their mobile devices.
"The collaboration between Lloyds and Microsoft is the first of its kind in the UK, as banks seek to bolster the security and accessibility of digital banking," the FT reported. Lloyds is planning to run the service as a trial later this year before rolling it out afterward.
New York Times
On second thought: Times financial columnist William D. Cohan says Daniel K. Tarullo's swan song from the Federal Reserve Board last week "was pretty surprising, all things considered. It also went largely unnoticed." According to Cohan, a former banker, Tarullo's "most unexpected statement" in a speech at Princeton was to acknowledge that the Volcker Rule, which Tarullo originally thought could add to the "safety and soundness of large financial firms," instead "was a mistake."
"Several years of experience have convinced me" that it "is too complicated" and consumes "too many supervisory, as well as bank, resources," the retiring Fed official said.
Daniel Tarullo, governor of the U.S. Federal Reserve, speaks during an event at Princeton University in Princeton, New Jersey, U.S., on Tuesday, April 4, 2017. It may be time to phase out one of Wall Street's most feared aspects of the Federal Reserve's stress tests, Tarullo said Tuesday on the eve of his last day on the board. Photographer: Ron Antonelli/Bloomberg
Ron Antonelli/Bloomberg
Goliath on steroids: How much does Vanguard dominate the mutual fund industry? Over the last three calendar years, the firm has brought in $823 billion from investors. By comparison, the rest of the mutual fund industry combined, comprising more than 4,000 firms, has attracted just $97 billion over the same period.
The Federal Trade Commission has ended enforcement of disparate-impact claims under federal antidiscrimination law, aligning with the stance taken by other federal agencies during the Trump era.
Berger Financial Group plans to more than double its footprint and staff, and Investcorp is looking at more opportunities beyond supporting Berger in the "untapped" wealth space.
Gateway Bank, which has narrowed its losses under new CEO Mukhtar Ali, hired a team of residential-construction lenders to speed its return to profitability.
The core provider is conducting a review of its offerings after a 21% decrease in earnings per share and a drop in revenue from its core banking sector.
Near-term expectations for price growth fell in the latest consumer sentiment survey from the Federal Reserve Bank of New York, but remains above the central bank's target across all time horizons.
