Why Wells fired consumer finance chief; SIFI ranks fall

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Survey says … : Bitcoin rebounded to nearly $8,000 on Friday after steep losses earlier last week, “a stretch that is volatile even by the digital currency’s standards,” the Wall Street Journal reports. A survey of bitcoin buyers by Yahoo Finance indicated more than 70% of respondents said they’ve made money on the digital currency recently while only 8% admitted they lost money. The median gain was $3,000, while the median loss was $500. Additionally, 56% of respondents think the cybercurrency is overvalued, with only 15% of saying bitcoin has room to run. Only slightly more respondents expect bitcoin to still be around in 10 years than see it gone. Wall Street Journal, American Banker here and here

Wall Street Journal
So long, SIFI: The Treasury Department recommended removing the “systemically important” label from nonbank financial institutions, such as insurance companies and asset managers. The report released Friday sends “a strong signal” that firms like MetLife, Prudential and BlackRock “can worry less about strict rules from Washington,” the paper reports.

Meanwhile, Zions Bancorp is expected to ask regulators Monday to free it from the SIFI label. The Utah-based bank’s request “is a sign of a shifting regulatory landscape in which the Trump administration has adopted a friendlier tone toward banking and in turn emboldened the banks,” the paper says.

Costly comments: Franklin Codel, Wells Fargo’s head of consumer lending, was fired for “disparaging remarks he made about the regulatory system to a previously terminated senior employee.” Codel allegedly made comments about golden parachutes to a former employee, who reported it to the bank, which then told regulators.

“Though it is not uncommon for bankers to make disparaging remarks about regulators in private,” the paper notes, “given Wells Fargo’s precarious position with a bevy of investigations and problems throughout the bank, it is in a delicate position.” Wells said it fired Codel “for acting in a manner that was contrary to the company’s policies and expectations of its senior leaders.”

Time to punt?: The recent selloff in Barclays’ shares raises the question: “Can a welterweight British bank afford to go toe to toe with bigger U.S. competitors in investment banking?” The bank “has cycled through four bosses in the past five years,” the paper notes, yet current CEO Jes Staley, “is trying to build it back up by reinvesting in a business line that has produced poor returns of late.” The bank’s stock is down 18% so far this year, the worst performance among major European banks.

Financial Times
Payout: Santander has agreed to pay the former head of its American subprime auto-lending unit $713 million in severance and compensation, which is actually less than what it said it would pay him more than two years ago. Thomas Dundon, who founded the unit in 1995 and sold it to the Spanish bank, left Santander “at a time of heightened tensions with regulators,” the paper says. At the time the bank said it would pay him about $1 billion for his nearly 10% stake in the unit.

Quotable
“If the right person asked me and the right job presented itself and it was the right time in my life, absolutely I would answer the call. There are a lot of people in government who want me to do a lot of things. On the other hand, I am not the person who either wants to or feels comfortable being in the public sector for most of my life.” — Former acting Comptroller of the Currency Keith Noreika about his prospects for returning to government.

Andrew Harrer/Bloomberg