Banking news roundup, June 16, 2023

Banking news roundup

June 16, 2023 5:36 PM

Discover Bank launches financial health fund, Cross River Bank climbs past real-time payment transaction benchmark, Webster funds financial education at youth-focused nonprofits and more in this week's banking news roundup.

Discover Bank launches financial health fund

$133-billion-asset Discover Bank, a unit of Discover Financial Services, has made a $36 million initial capital investment into the launch of the Discover Financial Health Improvement Fund, a fund for startups and early-stage technology companies working to support low- and moderate-income people, communities and small businesses in the mid-Atlantic region. The Riverwoods, Illinois-based bank will partner with the Financial Health Network to determine what companies can most effectively prop up the fund's beneficiaries while teaming up with Washington, DC-based venture firm ResilienceVC on earlier-stage investment and Wilmington, Delaware-based B2B venture investor Chartline Capital on later-stage investment. — Charles Gorrivan

Cross River Bank climbs past real-time payment transaction benchmark

Cross River Bank, a banking-as-a-service provider that makes loans through fintech lenders, announced this week that it had handled more than one million real-time payments. The Fort Lee, New Jersey, bank was an early participant in The Clearing House's RTP rail, which it joined two years after its launch in 2017. It has since employed an Application Programming Interface backed infrastructure to process over nine-and-a-half million transactions in areas like health care, insurance, sports betting, wallet off-ramps, marketplace and real estate. The bank said it had reined in $500 million in RTP volume in May alone.—Charles Gorrivan

Webster funds financial education at youth-focused nonprofits

Webster Bank in Stamford, Connecticut, is funding three New England nonprofit initiatives providing students in lower-to-middle income communities with financial education programs. The bank committed $100,000 each to three local groups as part of Webster's Finance Labs Initiative and the bank's $6.5 billion community investment strategy. Webster's partnership will give children "a community-guided and life-altering opportunity to learn that future financial success starts today," according to Victor Lopez, executive director of Connecticut-based Hispanic Coalition of Greater Waterbury, one of the groups in Webster's initiative. The two other organizations include YWCA Hartford Region in Connecticut and the Taunton Area School to Career in Massachusetts.— Jordan Stutts

Regional banks should draw more scrutiny, Lazard’s McGuire says

Although the situation has calmed since the collapse of Silvergate Capital Corp. and failures of Silicon Valley Bank and Signature Bank, regional and small banks should fall under more monitoring to prevent future crises, Ray McGuire, president of Lazard, said at a Bloomberg New Voices event in Washington on Thursday. McGuire also rejected statements made from some Republican lawmakers and politicians that the failure at SVB resulted from what they called "wokeness" or adherence to socially conscious investing. "I would reject summarily the notion that Silicon Valley Bank's failure is due to wokeness on the board — there's no evidence of that," McGuire said. "Risk management, yes. Wokeness, no." – Alicia Diaz and Kailey Leinz, Bloomberg News

Barclays shuffles investment bank ranks, hires for industrials

Barclays has filled several senior jobs at its investment bank as it works to stem attrition of U.S. staff following leadership changes. Alex Lynch was reappointed head of the global chairman's group. The appointment comes weeks after John Miller, who was announced in February as Lynch's replacement as the global chairman's group head, left to join Jefferies Financial Group. Barclays has also hired managing director Yuri Shakhmin from Credit Suisse Group AG to bolster its takeover advice for industrial companies. Shakhmin will join Barclays's Global Industrials Group in investment banking. Marie Freier is also joining the investment banking management team after her recent move from research, where she was global head of cross asset ESG research. The London-based firm has hired roughly 20 in its investment bank since the beginning of the year. Still, a number of staff have left since Cathal Deasy and Taylor Wright were named global co-heads of the unit in January. — Jan-Henrik Förster and Aaron Kirchfeld, Bloomberg News