Risk

Cannabis is becoming a big business in the U.S., but companies in the field still struggle to find financing. A broadly accepted way of assessing their creditworthiness would be a huge help.

Banks are concerned about the lack of clarity regarding legal liability in the Consumer Financial Protection Bureau's open banking rule, and fear that they will end up on the hook for data breaches or unauthorized transactions caused by a fintech or data provider.

Nonbanks that rely on sponsor banks to underpin their financial services may assume that "going direct" is safer after the Synapse bankruptcy. But banking-as-a-service middleware has its merits.

Congress publicly excoriated the supervisors and CEOs of last year's trifecta of megabank failures. But, what about the directors who were supposedly overseeing those CEOs? The entire chain of bank oversight needs to be rethought from congressional hearing rooms to banking board rooms.

Lincoln Savings Bank and Vantage Bank are two new clients of banking-as-a-service provider Unit. They say it improves their ability to 'go direct' rather than hinder it.

Sen. Jack Reed, D-R.I., asked the Federal Reserve to require public reporting of synthetic risk transfers — also known as credit risk transfers, or CRTs — through bank call reports and systemic risk reports.

U.S. banks need to start taking sustainability risk seriously

Contingency planning always seems theoretical...until it isn't. Planning for the unexpected can prepare you to serve customers well in times of crisis.

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.

Later this week, the Federal Reserve will release the results of its annual check-up on larger banks' balance sheets. Experts say there are always surprises, but that pending capital rules may have a bigger impact than the stress-test results on banks' dividend and buyback decisions.