Corporate finance

Corporations have tapped more than $124 billion in lines in the past three weeks; rating agency says virus “could wipe out a full year of U.S. banking profits.”

While analysts agree banks are in better shape than in 2008, lawmakers are dusting off a crisis-era tool used by the Federal Deposit Insurance Corp. to soothe potential liquidity fears during the coronavirus pandemic.

While loans continued to increase, growth was slower than one year previously and membership was flat.

Bankers will be pressed on upcoming earnings calls to forecast how the coronavirus pandemic — and the government's response — will shape credit quality, margins and fee income.

Margins will be squeezed after the Federal Reserve lowered interest rates earlier this month to counteract the economic fallout from the coronavirus.

The Fed announced several new lending facilities and virtually “unlimited” purchases of Treasury bonds; Ana Botín will donate the money to a coronavirus fund.

The central bank's sweeping actions suggest a cash shortage gripping sectors directly hit by the pandemic. Banks were supposed to be protected by Dodd-Frank but are still vulnerable to a funding domino effect.

The Federal Reserve committed Monday to conducting more asset purchases of Treasury securities and mortgage-backed securities and announced $300 billion in new financing for credit facilities.

The Federal Reserve committed Monday to conducting more asset purchases of Treasury securities and mortgage-backed securities and announced $300 billion in new financing for credit facilities.

BofA, JPMorgan said they are paying bonuses to branch and call center employees; the bank says removing the $1.9 trillion limit on growth will help it lend to more customers in need.

The central bank said its program to support money market mutual funds will also serve as a backstop for state and local governments.

The agencies said banks could receive Community Reinvestment Act credit for activities addressing the virus fallout, and clarified earlier guidance encouraging banks to dip into their capital buffers.

The expansion of the dollar swap lines allows foreign central banks to meet the needs of companies and financial institutions rushing for dollars as the global payments system undergoes severe strain due to the coronavirus.

The Money Market Mutual Fund Liquidity Facility, established under the central bank’s emergency authority, echoes a version that was set up during the global financial crisis.

Dozens of firms in industries most immediately hit by the virus and oil-price war — such as leisure, transportation, health care, energy and mining — have been drawing billions of dollars from existing credit lines.

The Federal Reserve's support for the commercial paper market made clear that it was willing to go beyond cutting interest rates, but the central bank may feel pressure to do even more as the crisis worsens.

Mastercard is working with Samsung to launch its Pay on Demand platform in emerging markets to drive financial inclusion.

Investment bankers have are trying to drum up interest from investment firms and hedge funds to provide tens of billions of dollars in financing to companies in industries upended by the coronavirus.

The central bank is trying to get ahead of possible funding disruptions caused by the coronavirus. Policymakers want to avert a repeat of September, when short-term borrowing costs spiked amid imbalances in supply and demand for cash.

The Consumer Financial Protection Bureau says the Cincinnati bank engaged in aggressive sales practices and open bank and credit card accounts without consumers' authorization in order to meet sales targets.