Slideshow

'Nice try JPM, but no cigar': Comments of the week

February 21, 2019 10:00 PM

Readers weigh legislative proposals on pot banking, consider JPMorgan's new digital coin, debate the Federal Deposit Insurance Corp.'s brokered deposit rules and more.

Kathy Kraninger, director of the Consumer Financial Protection Bureau (CFPB) nominee for U.S. President Donald Trump, swears in to a Senate Banking Committee confirmation hearing in Washington, D.C., U.S., on Thursday, July 19, 2018. Kraninger, a little-known official who has worked for the White House's Office of Management and Budget (OMB) since March 2017, is poised to succeed her boss Mick Mulvaney as director of the CFPB. Photographer: Andrew Harrer/Bloomberg

Andrew Harrer/Bloomberg

On the Consumer Financial Protection Bureau offering consumer refunds in just one of six settlements this year:

"I am not a fan of the CFPB, but at the end of the day the primary goal of this entity should be to 1) prevent harm to consumers and, 2) make them whole when they are harmed. An excuse that a company cannot identify to whom it 'crammed' unwanted products should be required to make restitution to everyone who "might" have been affected. That might go a long way towards goal #1."

Related: Why Kraninger's CFPB is mandating fewer consumer refunds

A marijuana leaf is displayed at a grow facility in Winnipeg, Canada.

On a look at competing pot banking proposals and what they would mean for different parts of the financial services industry:

"I REALLY hate to say this, but Warren's bill makes a lot more sense - it is federal Controlled Substances Law that creates the problem and amending it is the clean and logical solution. Prohibiting the regulators from adverse action is only addressing half the problem."

Related: Big, small banks have different ideas on how to fix pot banking

JPMorgan Chase is competing with Square, Block and other firms to capture business from merchants.

Michael Nagle/Bloomberg

On the potential impact of JPMorgan's new digital coin offering:

"Good piece and interesting punt by JPM. But the 'if' presented in this article — if every bank in the world will trust one bank — is a big if. Doubt it. So, nice try JPM, but no cigar. Time will tell."

Related: Can JPMorgan Chase's JPM Coin knock off Ripple and Swift?

Financial reports analysis

unknown/Wrangler - stock.adobe.com

On a look at how a new accounting standard could change the business of banking:

"It seems likely that long maturity loans (specifically the mortgages held by the GSEs) will have the greatest impact from CECL. And that cost would be borne, ultimately, by homeowners in the form of a higher cost to obtain a 30-year mortgage. That will then result in a dampening or even a weakening of home prices and the trajectory of home prices, as mortgage rates and home prices are strongly correlated. If that is what politicians want, then okay - but CECL seems generally ill-advised."

Related: House lawmaker warns of CECL's impact on Fannie, Freddie

Jelena McWilliams, chairman of the Federal Deposit Insurance Corporation (FDIC), speaks during a Senate Banking Committee hearing in Washington, D.C., U.S., on Tuesday, Oct. 2, 2018. The hearing focused on implementation of a new law easing Dodd-Frank Act rules on community and midsize banks. Photographer: Andrew Harrer/Bloomberg

Andrew Harrer/Bloomberg

On an argument urging the Federal Deposit Insurance Corp. to take additional information into account as it reconsiders brokered deposit rules:

"Facts are stubborn things, nearly as stubborn as entrenched attitudes and ideas embedded in a stodgy bureaucracy. It is heartening to see efforts by the new Chairman to move this organization to rethink it's long and stubbornly-held notions about brokered deposits (and many other issues). To restate the self-evident, it's not the deposits, it's what they are used to fund that pose the risk. Repeat that three times and the light should come on."

Related: What's missing from FDIC's notice on brokered deposits

On a push by a handful of industry officials to encourage the formation of new mutual banks:

"Why start a mutual when you can start a credit union instead and have your regulator be your cheerleader?"

Related: One group's plea to move mutuals off endangered list: Relax de novo standards