Bank News Lost in the Holiday Shuffle
January 5, 2014 11:01 PM
The second half of December is generally a slow period for news, with many people on vacation and businesses and government closed on holidays. Still, banks made a number of significant announcements this holiday season. In many cases the timing of disclosures may have been driven by circumstance regulators appeared eager to wrap up settlements by yearend.
(Image: Fotolia)
By the Way, We Canceled a Deal
Customers Bancorp (CUBI) in Wyomissing, Pa., led by Jay Sidhu, disclosed Dec. 20 it had consented to terminate a merger agreement with CMS Bancorp of Mt. Vernon, N.Y. This salient information was tucked inside a press release with the headline, "Customers Bancorp, Inc. Announces Actions to Support Capital Allocation Strategies." The press release also said there'd be no termination fee "by mutual consent," which doesn't jibe with what CMS said in its own press release. (CMS said it expects to receive $1 million as compensation for the cancelled deal.)
We Apologize for Any Inconvenience
At the peak of the holiday shopping season, JPMorgan Chase informed customers who had used their debit cards at Target during the retailer's data breach it would temporarily limit daily withdrawals to $100 and purchases to $300 .
(Image: Bloomberg News)
Regulators Put Coal in Amex's Stockings
On Christmas Eve, American Express (AXP) said federal regulators ordered it to pay nearly $76 million to settle allegations it used to deceptive marketing and unfair billing practices in selling credit card add-on products to its customers.
(Image: Bloomberg News)
By the Way, We're Paying Nearly $100M for This
Auto lender Ally Financial disclosed on Dec. 20 it had submitted to a consent order from the Consumer Financial Protection Bureau and Department of Justice over disparate impact claims. Readers had to wade to the fourth paragraph of the press release to find the cost: an $18 million civil money penalty and $80 million for a settlement fund. The CFPB says it was the largest auto loan discrimination settlement in history. The fund will be used to pay damages to the 235,000 minority borrowers that regulators believe paid higher interest rates for auto loans because of Ally's allegedly discriminatory pricing.
(Image: Bloomberg News)
BNY Mellon Settles with Massachusetts
Bank of New York Mellon agreed to repay Massachusetts' public pension funds $15.5 million to settle fraud claims brought by William Galvin, secretary of the commonwealth in the Bay State. He announced the deal Dec. 23. The next day the bank issued a press release trumpeting its contribution of $7.5 million and 15,000 volunteer hours to Pittsburgh area nonprofits over the course of the year.
(Image: Bloomberg News)
Barclays Fined on Boxing Day
The Financial Industry Regulatory Authority, a self-regulatory organization for securities brokerages, disclosed the day after Christmas it had fined the U.K. bank $3.75 million for failure to properly maintain records.
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Wells Settles with Fannie ...
Wells Fargo agreed to pay Fannie Mae $591 million to resolve repurchase demands on loans sold to the government-sponsored enterprise before 2009, the bank said Dec. 30.
(Image: Bloomberg News)
... While Flagstar Settles with Freddie
The same day, Flagstar Bancorp (FBC) in Troy, Mich., said it had agreed to pay Freddie Mac $8.9 million to settle mortgage repurchase claims. The settlement covers loans originated and sold to the GSE from 2000 to 2008.
(Image: Bloomberg News)
PNC Agrees to $35M Settlement Over NatCity Loans
The Pittsburgh bank reached a $35 million settlement with the Consumer Financial Protection Bureau and Department of Justice over allegations that National City- which PNC acquired in 2008- made higher-priced mortgage loans to minorities. The CFPB announced the deal Dec. 23.
The Wagon Rolls On
A Finra arbitration panel ordered Wells Fargo on Dec. 24 to buy back about $94 million of auction-rate securities from investors at par.
(Image: Bloomberg News)
