Slideshow 'Guilt Should Have Real Consequences': Comments of the Week

Published
  • January 15 2016, 7:30am EST
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American Banker readers share their views on the most pressing banking topics of the week. Comments are excerpted from reader response sections of AmericanBanker.com articles and our social media platforms.

A reaction to an op-ed advocating for more tangible consequences for bank guilty pleas:</P>

"Guilt should have real consequences. If the Department of Justice lacks the resources to prosecute to the full extent organizations that are highly complex, in cases that are highly complex, then it needs to be given those resources."

Related Article: Why Recent Bank Guilty Pleas Just Aren't Enough

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In response to the many ways Sen. Bernie Sanders wants to reform financial institutions:</P>

"[Banks] now make money at every parking meter, grocery store, indeed for medical care and burial services. Yes, break them up subject to laws of decency and equity. $35 late fees.…How does that cramp their 16.9% or higher interest earning on the outstanding balance? Payday lenders, really 300% rates! I AM a capitalist, not a whore."

Related Article: Sanders' Radical Plan Goes Well Beyond Breaking Up Big Banks


Reacting to the observation that government backing is an advantage for banks (via <a href="http://ralphanomics.blogspot.co.uk/" target="_blank">Ralphanomics</a>):</P>

"This article … says that entities that lend are better off with access to FDIC insured deposits. I'm sure they are. They're also better off with a Fed that lends hundreds of billions to banks in trouble at sweetheart rates of interest. The article doesn't seem to appreciate that there is a big problem here, namely what exactly constitutes a subsidy for banks and how large is that subsidy. Certainly loans by central banks at sweetheart rates of interest constitute a subsidy."

Related Article: Does Nature Want to Evolve a Bank?


On an analysis of how financial institutions survive, adapt and evolve (via <a href="https://www.linkedin.com/groups/3853492/3853492-6091284636330115073%3ftrk%3dhb_ntf_COMMENTED_ON_GROUP_DISCUSSION_YOU_CREATED%23commentID_6091314010005794816" target="_blank">LinkedIn</a>):</P>

"This makes me think of the words of Jim Clark when he was first commercializing Netscape: 'There are two ways to make money — bundling, and unbundling.' To some degree some of this is cyclical, and there is no doubt that the next economic downtown will expose those who are 'swimming naked.' Nonetheless, there is no doubt in my mind that these also represent deep, fundamental and permanent changes in an industry not [accustomed] to such.

Related Article: Does Nature Want to Evolve a Bank?

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A reaction to an analysis of the newer techniques banks are using to help identify customers, including through their fingerprints:</P>

"Have you noticed that the candidates are never specific regarding which regulations should be changed? Such protests are purely political."

Related Article: GOP Presidential Hopefuls Call for Slashing Regulations


A reaction to an op-ed by Sheila Bair on the need to stop treating small banks as if they caused the crisis:</P>

"Interesting comments from the ex-regulator who was a willing participant in the decision to direct TARP funds away from struggling community banks during the real estate crisis. Many of these banks were traditional small town institutions that had used prudent underwriting practices but were sucked into the tsunami caused by big banks doing risky real estate lending and other financial companies that enabled them."

Related Article: Stop Treating Small Banks as If They Caused the Crisis: Bair


In response to an op-ed that touts the advantages banks have over fintech companies (via <a href="https://twitter.com/SMTuffy/status/685595587564142593" target="_blank">Twitter</a>):</P>

"IMO: most #fintech firms are more interested in being bought by banks than disrupting them."

Related Article: Banks vs. Fintech? No Contest, Banks Win

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On GOP presidential hopefuls calling for less regulation at their debate in South Carolina:

"Have you noticed that the candidates are never specific regarding which regulations should be changed? Such protests are purely political."

Related Article: GOP Presidential Hopefuls Call for Slashing Regulations