Getting to yes: The House will soon approve the Senate bill to ease regulations on small and midsize banks. “We’ve got an agreement to be moving different pieces of legislation, so we will be moving the Dodd-Frank bill,” House Speaker Paul Ryan, R-Wis., said. “Passage of the measure would mark the most significant bipartisan overhaul of the financial rule book since Republicans took control of Washington last year, as well as the first major easing of the 2010 Dodd-Frank financial law,” the Wall Street Journal says. The House is also expected to pass several other deregulatory measures.
U.S. House Speaker Paul Ryan, a Republican from Wisconsin, pauses while speaking during a news conference on Capitol Hill in Washington, D.C., U.S. on Thursday, March 22, 2018. The House passed a $1.3 trillion spending bill that would avert a government shutdown and increase funding for the military, border security and other domestic programs, though a GOP senator who opposes the measure hasn't said whether he'll force a delay past a Friday funding deadline and cause a closure. Photographer: Joshua Roberts/Bloomberg
Joshua Roberts/Bloomberg
“The legislation [has] a clear path to passage,” the Washington Post notes. “It has moved through the Senate and appears to have plenty of support to pass the House,” after which it goes to President Trump for his signature.
Big jump: Citigroup shares recorded their biggest one-day increase in two years the day after activist investor ValueAct Capital Partners said it owns about $1.2 billion of bank stock.
ValueAct’s announcement “was hardly the most belligerent start to an activist campaign,” and the bank said it “welcomed” the investment. But it may not be as benign as it appears. “Longstanding critics of Citi seized on the activist’s arrival on the share register to highlight what they regard as the bank’s industry-trailing returns — and to revisit questions about its post-crisis structure,” the Financial Times says.
“This is a watershed event,” enthused Mike Mayo, Wells Fargo Securities’ banking analyst. “Citi is no longer too-big-to-engage.”
Wall Street Journal
Going, going…: The House voted Tuesday to kill a “controversial” 2013 Consumer Financial Protection Bureau guidance that sought to curb alleged discriminatory lending at auto dealerships. The measure passed by a vote of 234 to 175, with 11 Democrats voting for it. The bill was already passed by the Senate and now moves to the White House for President Trump’s signature.
Damaged legacy: Former New York Attorney General Eric Schneiderman, who stepped down following allegations he had physically abused four women, “helped wring big penalties in the wake of the financial crisis from JPMorgan Chase, Bank of America Corp. and other banks that had packaged and sold bad mortgages,” the Journal notes. “While Mr. Schneiderman’s tenure wasn’t marked by aggressive moves aimed at Wall Street, he used his position to exert influence on financial-services firms and in some cases won concessions from them. The state has gotten more than $5 billion in cash and aid for struggling homeowners from settlements with big banks.” but Schneiderman's departure won't be a boon for banks, according to American Banker.
Financial Times
Ghosts of the past: Bank of America is facing a class-action lawsuit in California alleging that LandSafe, the appraisals unit of Countrywide, the mortgage lender the bank bought just prior to the financial crisis in 2008, conducted “sham” appraisals by cherry-picking appraisers and taking other shortcuts in order to boost loan volume.
I see you: HSBC is rolling out facial recognition technology in 24 countries, including the U.S., U.K. and China. Corporate customers will now be able to log into their accounts on their iPhones just by looking at the camera.
Who's call was it?: Deutsche Bank’s recent decision to sharply cut back its U.S. investment banking division apparently wasn’t entirely the bank’s call. Long before new CEO Christian Sewing made the move, the European Central Bank and Germany’s banking regulator “were concerned that Deutsche’s U.S. investment banking footprint was too big and a potential source of instability,” the paper reports. European Union “banking watchdogs suggested to Deutsche about 18 months ago that it shrink its U.S. presence. The concerns were partly triggered by Deutsche’s woeful litigation record in the U.S., which was seen as a source of instability.”
Meanwhile, ING Groep is looking to expand its debt capital markets business in the U.S. The Dutch bank “was motivated in part by the sheer size of the U.S. market, which is nearly three times as large as European bond markets,” the paper says.
Still in the red: LendingClub’s first quarter revenue jumped 22% on an 18% rise in loan originations but it still reported a $31.2 million loss for the period.
Washington Post
The devil in the details: In a filing with the Securities and Exchange Commission, Equifax has provided “its most detailed analysis to date” of last year’s big data breach, “disclosing not only how many consumers it believes were hit but also the breakdown of which types of information were most likely to have been lost. Although the report does not identify new or additional victims, it marks the first time Equifax has provided such granular detail about the scope of the compromised data.”
Quotable
“We look forward to an additional [banking] reform package coming together that can pass the House and Senate this year.” — Senate Majority Leader Mitch McConnell, R-Ky.
The president-elect had billed his hardline stance on the border and promised deportations as a solution to tight housing markets. Experts say those policies, at least in terms of housing, could do more harm than good.
Industry observers say the U.S. securities industry's migration to next-day settlement in May 2024 was a technology success story, which has encouraged the U.K. and the EU to follow suit.
St. Paul, Minnesota-based Bremer Financial agreed to sell for $1.4 billion in cash and stock. It followed a yearslong legal battle between the bank and its largest shareholder that ended with a settlement this year.
Reps. Andy Barr, R-Ky., and French Hill, R-Ark., leading Republicans on the House Financial Services Committee, pushed back against Federal Deposit Insurance Corp. Chair Martin Gruenberg's characterization of the Synapse collapse in his July brokered deposits proposal.
