Banco Popular de Puerto Rico

Receiving Wide Coverage ...Auditors Disappoint: Initial audits of the auditors who inspect the financial statements of brokerage firms didn't go so well. In a report issued on Monday, the Public Company Accounting Oversight Board said it found deficiencies in all 23 of the broker-dealer audits from the 10 firms it reviewed as part of new duties allocated by Dodd-Frank. The Journal says two firms didn't adhere to Securities and Exchange Commission rules requiring independence among auditors, meaning they actually prepared or assisted in preparing the financial statements they were set to review. Regulators didn't name names in their report, but did say the results were "disappointing" and "disturbing" during a conference call.

Receiving Wide Coverage ...Here a Probe, There a Probe: Two more banks have joined the ranks of financial institutions under investigation this summer for questionable behavior. According to the Journal, a federal grand jury is looking into the very close ties Regions Financial may have had with executive recruiting firm Fiderion Group LLC and its CEO James Norton III. Prosecutors have asked the bank to turn over information on "any gifts, trips or vacations" Fiderion may have funded. They have also asked for information regarding any loans Regions may have made to the firm or to Norton. The paper, which reviewed documents and spoke to people close to the inquiry, says the grand jury's investigation doesn't necessarily indicate wrongdoing, and the target of the probe isn't clear. It had been previously reported that Fiderion paid the tab for Regions executives at annual golfing getaways from 2002 to 2008, but Norton said he believed these outings complied with the bank's rules on vendor relationships.

Receiving Wide Coverage ...Citi Blasts Nasdaq About (Not Via) Facebook: Citi is so displeased with Nasdaq's plans for making up for losses caused by the fumbling of Facebook's initial public offering, it sent the Securities and Exchange Commission a 17-page letter about it. According to the Journal, Citi told the SEC Nadsaq's proposed $62 million compensation plan would cover "only a very small fraction" of its total losses. The bank is estimated to have lost about $20 million during the botched IPO due to glitches that Citi deems weren't technical, but instead caused by "grossly negligent, self-serving business decisions." Other companies, including UBS and the nearly-killed-by-computer firm Knight Capital, suffered higher monetary damages and overall $500 million worth of losses is being attributed to the event. Citi is asking the SEC to reject Nasdaq's proposal. The Times reports the exchange disagrees with the bank's position, largely due to the fact that its customers are required to sign a contract agreeing to the exchange's rules. A Nasdaq spokesperson formally declined to comment.

Receiving Wide Coverage ...SEC Problems: More information is emerging on why Democratic commissioner Luis A. Aguilar decided to vote against Securities and Exchange Commission Chairman Mary Schapiro's plan to regulate money market mutual funds. Apparently, Aguilar "didn't appreciate" Schapiro's move to show Congress a report on the risks of money funds he viewed as misleading. The Journal reports Aguilar was already on the fence about the new proposal when news of the report's circulation was mentioned by several media outlets. Aguilar believed the proposal, which would require money funds to either float share prices like other mutual funds or to post capital against losses on their asset holdings, could have unintended consequences and possibly spread systemic risk to unregulated corners of markets. Many of Aguilar's colleagues are more than a little displeased with his decision. Schapiro called the failed vote "tragic," while former SEC chairman Arthur Levitt said Aguilar's decision represented a "sad day for the commission and the country."

The bank is looking to combine several units that invest in income-producing assets; increased scrutiny has led banks to address the risks of climate change.

Receiving Wide Coverage ...AG Questions B of A Settlement: New York attorney general Eric Schneiderman asked for information about Bank of America's $8.5 billion settlement agreement in the mortgage-backed securities case. The AG's move indicates he may challenge the deal, according to the Times. Letters sent by the AG's office indicate the settlement may have been made without the full participation of all investors who would be affected. The Journal says Schneiderman wants to know if public agencies or state-affiliated pension funds were included in the settlement. "Some mortgage-bond investors have already objected to the deal, citing conflicts of interest that raise questions about the fairness of the accord," the Journal says. The paper also reported Rep Brad Miller, D-N.C., in a letter questioned if the deal was fair to taxpayers or if the settlement amount is "too low." Wall Street Journal, New York Times

Receiving Wide Coverage ...B of A's Mortgage Mess: Tens of thousands of Bank of America borrowers will be evicted as a result of the bank's $8.5 billion settlement with regulators over mortgage-backed securities, the Times reported. Bank of America servicing executive Tony Meola said, "While not a desirable outcome, the recovery of the housing markets depends on moving through the foreclosure process as quickly and fairly as possible." Meanwhile, the settlement, plus the specter of an additional settlement, of up to $7 billion, with the 50 state attorneys general over mortgage-servicing practices, could leave the bank short of equity, according to the Journal's "Heard on the Street" column. Wall Street Journal, New York Times

Breaking News This Morning ...Earnings: "Citigroup's second-quarter profit jumped 24% as provisions for loan losses declined sharply from a year earlier but revenue fell 7%."

Receiving Wide Coverage ...Cordray Tapped for CFPB: President Obama will nominate former Ohio attorney general Richard Cordray to lead the new Consumer Financial Protection Bureau, sidestepping Harvard professor Elizabeth Warren, who envisioned the agency and spent the past year setting it up, the White House said Sunday. The Post said a formal announcement was expected Monday. The Journal said that as Ohio Attorney General Cordray butted heads with banks over mortgage foreclosure. Wall Street Journal, New York Times, Washington Post

Receiving Wide Coverage ...B of A Posts a Loss: Bank of America reported a loss of $8.8 billion during the second quarter partly due to the $8.5 billion settlement with investors in June who claimed the bank had sold them poor-quality mortgage-backed bonds. The reported loss to shareholders was 90 cents per common share, according to the Post. CEO Brian Moynihan said, "the solid performance in our underlying businesses continues to be clouded by the costs we are absorbing from our legacy mortgage issues," The Times reported. The Journal said that if you exclude the $1.23 charge a share in mortgage-related and other adjustments, the bank earned 33 cents a share. Wall Street Journal, New York Times, Washington Post