General
California opposes efforts by Trump administration to delay protections from payday lenders
Jeff Daniels, CNBC
California’s attorney general joined a coalition of two dozen other state attorneys general on Tuesday in opposing the Trump administration’s efforts to delay a consumer protection rule for payday lenders. The federal Consumer Financial Protection Bureau last month proposed repealing a 2017 “ability-to-pay” requirement that the industry opposed.
Trump’s economic report gets lightened up with superhero, ‘Star Wars,’ Monty Python names
Dan Mangan and Sarah Whitten, CNBC
This big new White House report isn’t a comic book — but some of the names in it belong in one. A list of “student interns” who worked on President Donald Trump’s new “Economic Report of the President” includes the names of Batman, Spider-Man and Captain America’s alter egos, “Monty Python” cast member John Cleese, a captain of a “Star Trek” starship, Kathryn Janeway — and, possibly, a purported heir to the throne in “Game of Thrones.”
Wall Street Is Betting the Fed’s Rate-Raising Days Are Done for Now
Matt Phillips, The New York Times
Just three months ago, investors were in a panic over the idea that the Federal Reserve might push borrowing costs too high and tip the United States economy into a recession. Now, Wall Street is toying with the idea that the central bank could actually be cutting interest rates by the end of the year.
What You Need to Know About Wednesday’s Fed Meeting
Jim Tankersley, The New York Times
The big question facing the Federal Reserve as it wraps up its two-day policy meeting on Wednesday is how much the central bank should worry about United States economic growth this year. Fed officials are expected to leave interest rates unchanged at the conclusion of the meeting, but the day could still hold plenty of action for investors, lawmakers and other Fed watchers.
UK to lose £1tn of financial assets to Europe due to Brexit
Stephen Morris, Financial Times
Financial services companies have committed to move about £1tn of assets out of the UK into Europe as the industry triggers its worst-case contingency plans with no Brexit deal in sight, according to consultancy EY. The estimate by EY — which mainly covers client assets and cash moved out of the UK by banks and fund managers as well as the transfer of balance sheets as operations are relocated — has increased by £200bn since the last survey in January.
Italy’s Embrace of China’s ‘Belt and Road’ Is a Snub to Washington
Vernon Silver and Sheridan Prasso, Bloomberg Businessweek
More than seven centuries after a 17-year-old Marco Polo set off from Venice on a voyage that would culminate at the court of Kublai Khan, the Italian city continues to tout itself as the westernmost point of the ancient Silk Road, China’s gateway into Europe. Now it faces some competition from Trieste, an increasingly busy port city on the northeastern edge of Italy, whose contributions to commerce and culture included popularizing coffee by importing, roasting, and shipping the beans northward, to Vienna’s cafes and beyond.
Trump administration withholds report justifying ‘shock’ auto tariffs
Eliana Johnson and Andrew Restuccia, Politico
A confidential government report has provided President Donald Trump with a legal rationale to impose heavy new tariffs on foreign cars as soon as this spring, a prospect fiercely opposed by White House officials and congressional Republicans alarmed by its enormous economic and political stakes. The Commerce Department submitted the report to the White House in mid-February, triggering a 90-day period for Trump to decide whether to impose tariffs, which could reach as high as 25 percent, on imported autos.
Stocks Decline, U.S. Futures Fluctuate Before Fed: Markets Wrap
Eddie van der Walt, Bloomberg
U.S. equity-index futures drifted and European shares fell Wednesday as investors adopted a cautious stance before the Federal Reserve policy decision and awaited further news on U.S.-China trade talks, where negotiators remain at odds. Ten-year Treasury yields slipped.
Banking
Banks progress on adhering to stricter international rules
Claire Jones, Financial Times
Banks are making progress towards meeting globally agreed standards, set after the financial crisis to ensure lenders can handle future bouts of market turmoil. The Basel Committee on Banking Supervision reported that banks had met initial standards on globally agreed capital and liquidity rules.
A Proposed Megadeal Exposes the Grim Outlook for Europe’s Banks
Elisa Martinuzzi, Bloomberg Businessweek
The world’s largest money manager has a stark warning: More than a decade after the global financial crisis, European banks still face a long and tortuous path to recovery. “Europe is in the midst of a painful, painful transition,” Philipp Hildebrand, vice chairman of BlackRock Inc., said on Bloomberg TV.
UBS Says First Quarter Was ‘One of the Worst’ in Recent History
Patrick Winters et al., Bloomberg
UBS Group AG Chief Executive Officer Sergio Ermotti gave the most decisive verdict yet on the difficult market conditions faced by Europe’s investment banks, describing conditions as the toughest in years. UBS will slow down hiring and deepen cost cuts by about $300 million as it confronts one of the worst first-quarter environments in recent history, Ermotti told investors at a conference in London on Wednesday.
Deutsche Bank Said to Work With Citi on Commerzbank Deal
Aaron Kirchfeld, Bloomberg
Deutsche Bank AG hired Citigroup Inc to advise on its possible combination with Commerzbank AG, according to people familiar with the matter. Citigroup has received a formal mandate to advise Germany’s largest bank on the deal with its closest rival, the people said, asking not to be identified discussing private information.
‘Friendly fraud’ is on the rise. Are banks complicit?
Penny Crosman, American Banker
Friendly fraud — when a fraud victim knows the perpetrator, and the fraudster has intimate knowledge of the target — has by all accounts been growing even as overall fraud has decreased in the past year. According to a study from Javelin Strategy & Research, friendly fraud doubled in 2018, from 7% to 15% of all fraud victims. All told, 14.4 million Americans were fraud victims in 2018.
Financial Products and Investments
Raymond James CFO Retiring After 32-Year Run
Tatyana Shumsky, The Wall Street Journal
America’s longest-serving finance chief is stepping down. Jeff Julien, CFO at brokerage Raymond James Financial Inc., is ending his tenure after more than three decades in the role. Mr. Julien joined the St. Petersburg, Fla., company in 1983 after working as a certified public accountant for Price Waterhouse.
California seeks to revoke auto title lender’s license
Kate Berry, American Banker
California’s financial regulator wants to revoke the license of an auto title lender for allegedly charging higher interest rates and fees than what is legally permitted and operating unlicensed storefronts. The state’s Department of Business Oversight filed an administrative action Tuesday against Fast Money Loan, in Long Beach, Calif., and its parent company, RLT Management. The agency said the lender charged annual interest rates above 100%, which exceeded the state’s usury cap.
More Detail and Plain English: Auditors’ Reports Get a Makeover
Michael Rapoport, The Wall Street Journal
Coming soon: More insights for investors about the biggest concerns lurking in their companies’ financial results. Auditors are gearing up to revamp and expand the yearly letter in which they bless a company’s financial statements.
Mastercard venture aims to help small banks keep up in payments
Will Hernandez, American Banker
Three companies have joined forces to help small banks keep up with the fast pace of technological change in payments. Mastercard, the fintech provider Urban FT and the payment services subsidiary of the Independent Community Bankers of America have launched a card services program called Community Access.
Housing and GSEs
California Has the Jobs but Not Enough Homes
Nour Malas, The Wall Street Journal
California’s economy is adding jobs far faster than affordable places to live, forcing some employers to leave the state as they expand. Companies that move from California have historically left behind its diverse industries, renowned public universities and balmy climate for states with lower taxes and lighter regulation.
Facebook agrees to overhaul targeted advertising system for job, housing and loan ads after discrimination complaints
Tracy Jan and Elizabeth Dwoskin, The Washington Post
Facebook on Tuesday agreed to overhaul its lucrative targeted advertising system to settle accusations that landlords, lenders and employers use the platform to discriminate, a significant shift for a company that built a business empire on selling personal data. The settlement compels Facebook to withhold a wide array of detailed demographic information — including gender, age and Zip codes, which are often used as indicators of race — from advertisers when they market housing, credit and job opportunities.
Taxes
House Ways and Means chair should ‘immediately’ request Trump’s tax returns, liberal groups say
Toby Eckert, Politico
Liberal activists say they are “doubling down” on their effort to pressure House Ways and Means Chairman Richard Neal to obtain President Donald Trump’s tax returns. Stand Up America and Tax March are spearheading what they call “a national day of action” Tuesday, encouraging constituents of Democratic Ways and Means members to call their offices and urge them to “publicly demand Chairman Neal immediately submit the request for Trump’s personal and business tax returns” to the Treasury Department.
Trump’s Tax Cut Won’t Power the Growth He Predicts, Officials Concede
Jim Tankersley, The New York Times
The Trump administration pushed a $1.5 trillion tax cut through Congress in 2017 on the promise that it would spark sustained economic growth. While the tax cuts have goosed the economy in the short term, officials now concede they will not be enough to deliver the 3 percent annual growth the president promised over the long term.
Financial Technology
Banks seek Congress’ help to block fintech path to ‘industrial’ charters
Steven Harras, Roll Call
A bank industry group is lobbying Congress to block financial technology firms, such as online lender Social Finance Inc. and payment processor Square Inc., from obtaining an obscure form of a state bank charter that would let them operate nationally with little federal supervision. The Independent Community Bankers of America last week distributed a policy paper around Washington calling for an immediate moratorium on providing federal deposit insurance to industrial loan companies, or ILCs, which are chartered by only a few states — most notably Utah.
Report Says Most Crypto Trading Volume Is Suspicious
Olga Kharif, Bloomberg
Most of the trading volume on the world’s largest cryptocurrency exchanges is questionable, according to a report from a startup that revisits one of the recurring concerns in the decade-old digital-asset market. By analyzing internet traffic on the top 100 crypto exchanges’ websites, the Tie determined that 75 percent of the exchanges reported trading volumes that were more than double expected.
Opinions, Editorials and Perspectives
President Trump Has Some Stories to Tell About Deutsche Bank
Timothy L. O’Brien, Bloomberg
In 2006, Donald Trump sued me for libel, claiming that a biography I wrote, “TrumpNation,” lowballed his wealth and misrepresented his track record as a businessman. Trump lost the suit in 2011. He had sought $5 billion in damages, which was, more or less, the difference between what he claimed he was worth at the time — about $6 billion — and what my sources believed him to be worth: $150 million to $250 million.
Why Wells Fargo is struggling to put its past behind it
Ben McLannahan, Financial Times
“Is the problem fixed at Wells Fargo?” asked Sean Duffy, a Republican congressman. “It is,” replied Tim Sloan, the bank’s CEO.
Research Reports
The Politics of CEOs
Alma Cohen et al., Tel Aviv University
We use Federal Election Commission (FEC) records to compile a comprehensive database of the political contributions made by more than 3,500 individuals who served as CEOs of S&P 1500 companies between 2000 and 2017. We find that these political contributions display substantial partisan preferences in support of Republican candidates.
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