Wells looking at gender bias claims; TD's U.S. ops drive profit
Editor's note: Morning Scan will not publish on Monday, Sept. 3, in observance of Labor Day. We'll be back on Tuesday, Sept. 4.
Wall Street Journal
More trouble at Wells: Wells Fargo is investigating allegations of gender bias in its wealth management division. According to the Journal, several women managers say Jay Welker, the head of the division for the past 15 years, said "women should be at home taking care of their children," often calling women "girls" or telling them to put their "big girl panties on." Only 12 of the 45 regional managing directors in the division are women, and all seven senior managing directors above that level are men.
But that's not all. The bank fired or suspended more than a dozen people in its investment bank for violating its policy of reimbursing employees for ordering after-hours meals. According to the Journal, "some employees regularly placed dinner orders through delivery services … earlier than the policy allowed," then later "allegedly altered the time stamps on emailed receipts to make their meals eligible for reimbursement."
Profit driver: Toronto-Dominion Bank said its U.S. division was a primary driver of profit growth in its fiscal third quarter. The division, which is one of the 10 largest banks in the U.S., earned 1.14 billion Canadian dollars ($883.16 million), up 27% from the year-earlier quarter, contributing more than a third of the Canadian parent company's total net income, which rose 12%. "The U.S. footprint is powerful," said James Shanahan, an analyst at Edward Jones.
About face: Merrill Lynch said it will resume charging commissions on retirement accounts, reversing its earlier policy of charging fees based on assets, which it had said was better for clients. The new policy goes into effect October 1. "The move to reintroduce commission-based brokerage accounts for retirement money is the result of the fiduciary rule being killed" by an order of the Fifth U.S. Circuit Court of Appeals back in March. Some clients "also resisted a transition to a fee-based model, which typically costs roughly 1% of assets under management."
Separately, President Trump is scheduled to sign an executive order Friday that would direct the Treasury Department to study easing the rules on required minimum distributions from retirement accounts. "If successful, it could allow retirees to spread retirement savings over a longer period," rather than having to start taking annual withdrawals after age 70 ½. The order also would direct Treasury and the Labor Department to look into making it easier for small businesses to offer 401(k) plans to their employees.
Moving: Tadhg Flood, co-head of Deutsche Bank's global team of bankers that advises financial services clients in Europe, the Middle East and Africa, is leaving join Centerview Partners, a deal advisory firm.
Can it happen again?: Continuing its series on the "Financial crisis: Are we safer now?," the FT "looks at why the warning signs were missed and where the next crash may strike."
Welcome to the club: Silicon Valley venture capital firm Andreessen Horowitz named its third female partner in a little more than two months. Angela Strange, who has worked on fintech investments for the past three years, was named the firm's 13th general partner. "The spate of female hires marks an abrupt shift" at the company "and comes as one of the most lucrative careers in finance has been hit by relentless criticism about gender discrimination."
New York Times
Who ever could've seen that coming?: Two years ago, Indian Prime Minister Narendra Modi embarked on an audacious scheme to pull the rug out from the nation's criminals by attempting to make their ill-gotten gains worthless. His thinking went like this: "I'll surprise everyone (literally everyone — his own cabinet didn't know) by telling them they have 50 days to exchange their old paper notes for new ones. Surely, crooks will be too scared to expose themselves at banks trying to exchange their illicit funds." Only, of course, it went nothing like this. Not only did country's businesses suffer a hit (what with everyone putting work on hold to wait in endless lines at banks), but it's estimated that about 99% of the old notes' value found their way to the new currency. The crooks found a way to turn their money in. Needless to say, many think his chances at reelection are a bit dodgy.
Just going to leave this here: "Elizabeth Warren isn't out to get capitalism. She's out to save it."
"It's like walking into a grocery store to buy milk and being asked for your citizenship at checkout — banking is one of the core aspects of daily life in this country. To be faced with this question in order to do banking seems as un-American as you can get." — Paulina Gonzalez, executive director of the California Reinvestment Coalition, on reports that Bank of America customers are being asked to prove citizenship.