Risk

While the federal banking agencies are not changing any current rules, they issued a joint statement Thursday cautioning banks about risks in third-party deposit partnerships. They are also seeking public input on bank-fintech partnerships more generally.

Bank OZK is the latest commercial real estate-heavy bank to announce plans to diversify its business. CEO George Gleason emphasized that he's confident in the bank's loan portfolio, but said he thinks misperceptions are dragging down the stock price.

Lenders and financial institutions should allow consumers to report nontraditional financial activities in an effort to adopt and validate newer, more inclusive credit scoring models.

The basics of good banking — a strong balance sheet, customer service and solid risk analysis — will always be important. But in the future, technological competence will be the difference between the sector's winners and losers.

Two days after the megabank was hit with $136 million of fines, Citi executives said they aren't changing the company's full-year expense guidance. Citi has 30 days to submit a plan to regulators showing that the bank has allocated enough resources to achieve compliance in a timely and sustainable manner.

The ratings firm evaluated 4,100 loans to assess the state of 41 banks' commercial real estate risk. It found that the lenders should be holding, on average, about twice the amount of reserves they currently have for office loans.

The Canadian bank has appointed Erin Morrow, who had served as deputy chief compliance officer for about six months, to replace Monica Kowal, who parted with TD July 2. The announcement comes as TD faces questions by U.S. and Canadian regulators about its anti-money-laundering compliance.

Reconciliation problems normally don't happen on the scale that is playing out with Synapse and its partner banks. But banks and their fintech partners can do a better job of communicating the realities of accessing financial services through nonbank entities.

The Federal Deposit Insurance Corp.'s framework for resolving a large bank failure is inadequate and leaves the door open to future taxpayer-subsidized bailouts.

CRTs have changed since the financial crisis. But the eventual credit cycle turn is likely to show again that weaker banks' CRT use merely transformed, but did not eliminate, risk.