Latest banking news

December 9, 2022 2:38 PM

Scroll through to see what you might have missed this week in banking, payments, credit unions and more.

Bank of America's Seattle leadership shift

Bloomberg News

Bank of America has reorganized leadership in its Seattle Market. Jim Morehead, a longtime resident of the Emerald City, will become BofA's president of Seattle while remaining a commercial market executive for the bank's western Washington and Pacific Rim market. Meanwhile, 25-year BofA veteran Alex Yang was named Seattle market executive after a stint in the bank's global transaction services group as a CashPro product manager, and Jeremey Williams was promoted to customer relationship management executive. — Jordan Stutts

Western Alliance board turns page after Sarver scandal

Robert Sarver.

Christian Petersen/Getty Images

Western Alliance Bancorp. in Phoenix appointed two new board members this week. The $65 billion-asset bank's board of directors nominated Kevin Blakely and Paul Galant, according to a Western Alliance statement. Blakely was Huntington Bancshares' chief risk officer from 2009 to 2012 and currently is a senior advisor to the consulting firm Oliver Wyman. Galant is a former Citibank executive. The appointments are part of a "succession and refreshment process" after Western Alliance's former executive chairman Robert Sarver, majority owner of the NBA's Phoenix Suns, resigned his seat after an ESPN story in November 2021 detailed allegations of workplace racism and misogyny at the Suns. — Jordan Stutts

Walmart-affiliated fintech reportedly plans BNPL lending

David Paul Morris/Bloomberg

One, a digital financial services firm that's part of a fintech venture connected to Walmart, plans to launch a buy now/pay later service sometime in 2023. The product is designed for Walmart's stores and digital channels, though it could also be used at other retailers, reports CNBC, citing unnamed sources. Walmart launched a fintech venture in 2021 in partnership with investor Ribbit Capital. That venture, called Hazel, in early 2022 acquired two fintechs, One and Even, and the venture took on One's brand. Walmart has gradually added financial services such as prepaid cards over the years, and more recently has focused on centralizing those services to support easier access. A BNPL service could add another option for Walmart at the point of sale, and also allow the superstore chain to compete with rival Amazon, which offers BNPL as an option through a collaboration with Affirm. Walmart did not provide comment by deadline. — John Adams

JPMorgan CEO Jamie Dimon calls crypto tokens 'pet rocks'

Andrew Harrer/Bloomberg

JPMorgan Chase Chief Executive Jamie Dimon likened crypto tokens to "pet rocks," continuing his long history of skepticism about the digital assets. "Why do we allow this stuff to take place," Dimon said in an interview with CNBC on Tuesday. He spoke as contagion from the collapse of FTX spreads. The bank boss told lawmakers in September that cryptocurrencies are "decentralized Ponzi schemes." Still, he wrote in his annual letter to shareholders, "decentralized finance and blockchain are real, new technologies" and went on to tout his bank's efforts. Dimon has for months been warning of economic headwinds that could push the U.S. and global economies into recession next year. He declined to make a specific prediction, saying in the interview that storm clouds "could be a hurricane, we simply don't know." JPMorgan benefited from the Federal Reserve's rate hikes in the third quarter, reporting its highest quarterly net interest income ever. — Max Abelson, Bloomberg News, with assistance from Hannah Levitt.

Starbucks metaverse loyalty program goes live

Chris Ratcliffe

Starbucks Odyssey, a metaverse-themed experience for Starbucks Rewards program members, has gone live with a group of beta users. Participants may use a credit card to purchase "journey stamps," which are limited-edition NFTs (nonfungible tokens), each pegged to a different point value based on their rarity. Users may buy and sell these tokens within the blockchain-powered Starbucks Odyssey app to earn points redeemable for Starbucks merchandise and experiences. — Kate Fitzgerald

American Express Platinum clients double even with fee hikes

Patrick T. Fallon/Bloomberg

American Express said the number of Platinum cardholders in its portfolio doubled in recent years even as it pushed the annual fee to $695 from $450. The company will continue to revamp the card's perks and adjust the annual fee accordingly, Chief Executive Steve Squeri said at an investor conference hosted by Goldman Sachs in New York Tuesday. American Express has added a raft of benefits in recent years, including credits for Walmart Inc.'s subscription service and ride-sharing companies as well as flight and hotel perks. "The reality is, it'll go as high as the value allows us to go," Squeri said of the Platinum card's annual fee. The changes have buoyed AmEx's net card fee revenue, which has jumped 15% to $4.45 billion so far this year. — Bloomberg News

U.S. consumer borrowing rises $27.1 billion in slight pickup

Adobe Stock

U.S. consumer borrowing accelerated in October from a month earlier, reflecting an increase in credit card balances and steady growth in nonrevolving lending. Total credit increased $27.1 billion from the prior month after rising almost $26 billion in September, Federal Reserve figures showed Wednesday. The median forecast in a Bloomberg survey of economists called for a $28 billion advance. The figures aren't adjusted for inflation. Revolving credit outstanding, which includes credit cards, increased $10.1 billion. Nonrevolving credit, such as loans for school tuition and vehicle purchases, rose $17 billion. Inflation running near a 40-year high has exceeded wage growth, prompting many Americans to turn to credit for purchases and dip into savings. Despite the drop-off in purchasing power, consumer spending has remained largely resilient. The gain in nonrevolving credit was helped by a pickup in auto sales, which rose in October at their fastest annual pace since the start of the year. — Molly Smith, Bloomberg News, with assistance from Jordan Yadoo

Partners Bancorp in Maryland taps insider to be next CEO

Partners Bancorp in Salisbury, Maryland, has a new CEO. The $1.7 billion-asset company, which has two bank units, said John Breda succeeded Lloyd Harrison, who moved into the role of senior executive vice president. Breda remains president and CEO of Bank of Delmarva in Delaware, one of the bank units, and Harrison continues as CEO of Virginia Partners Bank. "I want to thank Lloyd for his excellent service as the company's CEO and his leadership following the combination of Virginia Partners Bank and The Bank of Delmarva that created Partners Bancorp," Jeffrey Turner, the company's chairman, said in a press release. Partners had agreed to be sold to OceanFirst Financial this year, but the deal was called off in November amid regulatory delays. — Jim Dobbs

Gift card giant faces class action over data breach

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Blackhawk Network, the nation's leading provider of prepaid gift cards, has been hit by a class action triggered by a data breach in September at MyPrepaidCenter.com, a website Blackhawk operates that allows consumers to manage their gift cards. Classaction.org reports the breach exposed names, email addresses, phone numbers and payment card data. The 34-page lawsuit seeks damages for real and potential harm to consumers resulting from unauthorized access to their data. It was filed last month against Pleasanton, California-based Blackhawk Network in U.S. District Court for the Northern District of California, San Francisco division. — Kate Fitzgerald

First Tech Federal Credit Union hires experience and marketing chiefs

Ken McCarthy

First Tech Federal Credit Union in San Jose, California, named Jason Heupel chief experience officer and Brandon Hunt chief marketing officer. Heupel joins the $17 billion-asset First Tech from Aspiration, a fintech in Marina Del Rey, California, where he was vice president of customer experience. Hunt was head of product, marketing and growth for Nike. "We are excited to have these exceptional leaders on board and know their wealth of experience will be paramount in advancing First Tech's growth and relevancy … as a trusted partner heading into 2023," Greg Mitchell, the credit union's president and CEO, said in a press release. — Frank Gargano

Payments processor NMI buys merchant-onboarding tech firm

chokniti - stock.adobe.com

NMI, a payment processor catering to independent service organizations, has acquired Agreement Express, which specializes in software to streamline merchant onboarding. Agreement Express, founded in 2001, also provides technology for customized merchant risk scoring, compliance monitoring and fraud screening that NMI, of Schaumburg, Illinois, plans to incorporate into its payment solutions serving 277,000 merchants around the world, the companies said. The sale price was not disclosed. Agreement Express is based in Vancouver, Canada. — Kate Fitzgerald