'Tech's Not Optional': Comments of the Week
January 29, 2016 7:30 AM
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.
On the absence of tech-related questions from recent bank earnings calls (via <a href="https://twitter.com/KMcDermottFTech/status/692359322412670977" target="_blank">Twitter</a>):
"'Analysts are skeptical about pie-in-the-sky futurism.' Imagine the bank that ignored ATM's or online banking? Tech's not optional."
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On Discover Financial Services launching a credit card designed for riskier borrowers:
"Here we go again Alt-A lending again? Some people just never learn. Who will bail them out in a few years?"
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On fintech companies crunching social media data to underwrite loans:
"Imagine if your 'friends' tell the bank bad things about you. Are they now a 'credit bureau or reporting agency'? Do they have to provide you with a free report about what they said about you so you can set the record straight? Can you sue them [with] libel? Do the friends have protection if they offer an unfavorable opinion?"
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In response to criticism of a controversial accounting plan for setting aside loan-loss reserves:
"These data driven models are wonderful conversation pieces, but it seems like they never quite model out reality when the real stresses hit."
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In response to an op-ed arguing that consumers are hurt by the CFPB's regulation of auto lenders:
"The neediest consumers get the worst of this. Typical CFPB."
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Questioning the benefits of models, such as that proposed by FASB, to predict losses:
"There were a lot of extremely smart people in very expensive suits at Lehman Brothers and other places that had highly sophisticated models predicting how their financial instruments would perform in the future. There were also a very large number of community bankers whose experience and 'gut' told them it was all crap. Moral of the story: Beware of bright young MBAs with powerpoint presentations on predictive analytics
"
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Responding to an op-ed arguing that large banks have made progress in reducing their risk since the financial crisis:
"The Risk Officers may be trying to fight the good fight, but the bankers are still showing up in Aspen for that well-deserved break in the action. After the sun goes down, I doubt many bankers would testify that they have a lot of comfort regarding their true positions and risk exposures the kaleidoscope has a few too many crystals for simple pattern recognition."
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