• The White House is expected to recommend new banking rules to be implemented by the Federal Reserve, the Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency, including re-establishing certain requirements dropped by the Trump administration for midsize banks with $100 billion to $250 billion in assets, according to two people aware of internal discussions. President Joe Biden is not expected to seek a repeal of the 2018 Trump law that rolled back midsize bank regulations, and sources noted that the nature of the forthcoming recommendations could change prior to the White House finalizing the plans. (The Washington Post)
• Facing political pressure to spare smaller banks from the fallout of the collapses and subsequent FDIC receivership of Signature Bank and Silicon Valley Bank, agency officials are considering saddling large banks with a bigger-than-usual portion of the $23 billion in costs it faces, according to people with knowledge of the matter. Sources noted that talks are in the early stages, but leaning on large banks to help shore up the agency’s $128 billion deposit insurance fund is viewed as the most politically viable solution. (Bloomberg)
• The FDIC has confirmed plans to sell Signature Bank’s Signet, a real-time payments network for crypto companies that had remained in receivership and was not part of the regulator’s sale of Signature assets to New York Community Bancorp. (Bloomberg) Separately, FDIC Chair Martin Gruenberg told the House Financial Services Committee that the agency plans to return $4 billion in deposits related to Signature’s digital banking operations by early April. (CoinTelegraph)
• Treasury Secretary Janet Yellen told lawmakers that she expects Ajay Banga, the former Mastercard Inc. chief executive nominated by Biden to head the World Bank, to be elected to the position. Although private nominations could be made, two people familiar with the situation said they weren’t aware of any other nominees ahead of yesterday’s 6 p.m. nomination deadline. (Financial Times)

Worth watching:

• Richmond Fed President Thomas Barkin will speak at the Virginia Council of CEOs’ quarterly meeting. 

Home sales turn corner due to mortgage easing

Axios

FASB Wants Companies to Expand Disclosure of Labor and Other Expenses

Mark Maurer, The Wall Street Journal

The U.S. accounting standard-setter’s proposal, if approved, would require publicly traded businesses to break down areas such as inventory expenses and disclose employee compensation in the footnotes to their financial statements

Taiwan Is Pushing Biden for a Tax Deal That Could Infuriate China

Jenny Leonard, Bloomberg

President Joe Biden wants to bring the world’s most sophisticated chipmakers to the US. Taiwan says he should offer them a better tax deal –- one that could infuriate China. Taiwanese officials are pushing hard for an agreement to eliminate the burden of double taxation, like the US has with dozens of countries.

Biden World Bank nominee: massive private sector investment needed to alleviate poverty, fight climate change

Jared Gans, The HIll

President Biden’s nominee to lead the World Bank said massive investment from the private sector is needed to alleviate poverty and fight the effects of climate change.

Republican Budget Still Months Away, Complicating Debt-Ceiling Talks

Natalie Andrews, The Wall Street Journal

The chairman of the House Budget Committee, Texas Rep. Jodey Arrington, said in an interview that the GOP budget process could take months to play out, pushing it past the deadline for Congress to act on raising the debt ceiling and avoid a U.S. default on debt payments and other government obligations.

Biden administration warns of ‘damaging’ effects from GOP budget plans

Tony Romm and Marianna Sotomayor, The Washington Post

Republicans seek to cut federal spending by $130 billion, but agencies say that could delay Social Security, snarl travel, furlough FBI agents and disrupt public housing

Powell Points Republicans to Forecasts Showing One More Rate Hike

Laura Litvan, Bloomberg

Federal Reserve Chair Jerome Powell, asked in a private meeting with US lawmakers how much further the central bank will raise interest rates this year, pointed to policymakers’ latest forecasts showing they anticipate one more increase, according to Republican Representative Kevin Hern.

U.S. labor force gap mostly due to pre-pandemic trends, study finds

Howard Schneider, Reuters

Almost all of the remaining shortfall in U.S. labor force participation is the result of demographic and other trends that predate the COVID-19 pandemic, according to new research that suggests little chance that growth in the number of workers will help ease a tight American job market.

Lawmakers spar over ‘fiscal state of the union’ amid debt limit stalemate

Aris Folley, The Hill

The House Budget Committee held a hearing examining the “fiscal state of the union” on Wednesday, as both sides remain far apart over how to avoid a national default later this year.

Top economist Mohamed El-Erian warns that ‘erosion in trust’ caused by banking crisis will lead to ‘economic contagion’

Chloe Taylor, Fortune

The fractures in the banking system could still have a major impact on Americans thanks to the lingering threat of “economic contagion,” prominent economist Mohamed El-Erian has warned—and there is little policymakers can do to stop it.

Bipartisan senators unveil bill to claw back executives’ compensation after bank failures

Julia Shapero, The Hill

A bipartisan group of senators introduced legislation on Wednesday to claw back some or all of the top executives’ compensation from the five years leading up to bank failures, following the high-profile collapse of Silicon Valley Bank and Signature Bank earlier this month.

Fed official tells Congress many to blame for Silicon Valley Bank failure

Hannah Lang, Reuters

The scope of blame for Silicon Valley Bank’s failure stretches across bank executives, Federal Reserve supervisors and other regulators, the banking system’s top cop on Wednesday told U.S. lawmakers demanding answers for the lender’s swift collapse.

FDIC hires Newmark Group to sell billions of Signature Bank debt – source

Manya Saini, Reuters

The Federal Deposit Insurance Corp (FDIC) has hired Newmark Group Inc. to sell about $60 billion of failed lender Signature Bank’s loans, a person familiar with the matter told Reuters on Wednesday.

Small Banks Are Losing to Big Banks. Their Customers Are About to Feel It.

David Benoit et al., The Wall Street Journal

Scott Anderson answered the doorbell one night in March to find his 8-year-old neighbor waiting with a bag of popcorn. Mr. Anderson, the chief executive officer of Zions Bank ZION 3.64%increase; green up pointing triangle in Utah, had helped the boy open an account on his birthday last year.

Bank of America’s financial planning app draws $55 billion over two-plus years

Lananh Nguyen and Nupur Anand, Reuters

Bank of America Corp’s digital personal finance tool, Life Plan, has attracted more than $55 billion in new money since its launch in late 2020, as customers use technology to set financial goals.

U.S. prosecutors move to drop Libor case against ex-SocGen bankers

Jody Godoy, Reuters

U.S. criminal charges should be dropped against two former Societe Generale SA bankers for allegedly trying to rig the London interbank offered rate, prosecutors told a New York court on Wednesday.

JPMorgan, Goldman Plan to Start Trading Private Credit Loans

Lisa Lee and Paula Seligson, Bloomberg

Wall Street banks are looking to start trading private credit loans as they seek to make inroads into the lucrative world of direct lending, a potential first step that could ultimately reshape the largely buy-and-hold market.

Blackstone’s Schwarzman Says US Banking Crisis Is ‘Solvable’

Hideyuki Sano and Takako Taniguchi, Bloomberg

Blackstone Inc.’s Steve Schwarzman expects most US banks to withstand the current industry turmoil, blaming it on the after-effects of the pandemic and technology rather than a wave of bad loans.

Former FDIC Chair McWilliams warns against unlimited deposit insurance

Kyle Campbell, American Banker

Former Federal Deposit Insurance Corp. chair Jelena McWilliams cautioned against lifting the cap on insured deposits in the wake of bank runs that caused two banks to fail this month.

Goldman Sachs has big plans for using generative AI, including helping non-tech employees write code. Here’s how.

Bianca Chan, Insider Premium

Every once in a while, a monumental technology advancement occurs that upends the way businesses are run. And according to one of the top tech execs on Wall Street, we’re on the cusp of another thanks to recent breakthroughs with artificial intelligence.

Morgan Stanley Downgrades Charles Schwab for First Time, Slashes Target

Subrat Patnaik, Bloomberg

Charles Schwab Corp.’s clients are pulling cash out of the firm’s low-interest-rate bank accounts at twice the rate that Morgan Stanley expected, prompting the firm’s analyst to yank his buy-equivalent rating on Schwab for the first time since he began covering the brokerage stock seven years ago.

Why ESG in America May Face a Rough Road Ahead

Tim Quinson, Bloomberg

If BlackRock Inc.’s largest ESG-labeled exchange-traded fund is a bellwether for the sustainable investing industry, it’s fair to say the US sector may be in for a bumpy ride.

This agency tries to preserve pensions for millions of people

Omari Daniels, The Washington Post

The Pension Benefit Guaranty Corp. renegotiated retirement plans during the pandemic.

US pending home sales rise for third straight month; loan demand increases

Lucia Mutikani, Reuters

Contracts to buy U.S. previously owned homes increased for a third straight month in February, raising cautious optimism that the housing market slump could be bottoming out.

Commercial-property losses will add to banks’ woes

The Economist

Ask an investor to describe the outlook for commercial property and you will get a colourful response. “Office is a dumpster fire,” says Daniel McNamara of Polpo, an investment fund. His view of the wider market, which includes shops and warehouses, is only a little less grim: “It really is the perfect storm.”

Banking drama tightens screws on housing, offices

Javier E. David, Axios

Higher interest rates and a loss of confidence in the banking sector have hit commercial real estate especially hard, with both the housing and office sectors poised to feel the chill.

Exodus From America’s Big Cities Slowed Last Year as Pandemic Receded

Paul Overberg et al., The Wall Street Journal

Big cities lost fewer residents last year as more immigrants moved in, fewer people died and more babies were born there, according to new census data that shows the urban exodus that gained steam early in the pandemic is cooling.

Manhattan’s Population Is Rebounding While the Other NYC Boroughs Shrink

Alexandre Tanzi, Bloomberg

The population of Manhattan grew in the most recent period tracked by the US Census Bureau while New York City’s four other boroughs lost residents as the city struggles to rebound from a pandemic exodus.

US regulator sues Beaxy in expanded crypto crackdown, as platform shuts down

Chris Prentice and Jonathan Stempel, Reuters

The U.S. Securities and Exchange Commission (SEC) charged crypto firm Beaxy.com and several executives for registration failures on Wednesday, expanding regulators’ push to rein in the industry.

Ex-CEO of Binance’s US firm has enlisted lawyer for US investigations

Angus Berwick and Chris Prentice, Reuters

A former chief executive of Binance’s de-facto U.S. subsidiary has enlisted a former federal prosecutor and top cop at the Commodity Futures Trading Commission to represent her in the U.S. government’s investigations into the giant cryptocurrency exchange, a person with direct knowledge told Reuters.

Investors pull $1.6 billion from Binance after CFTC lawsuit

Elizabeth Howcroft, Reuters

Investors withdrew $1.6 billion of cryptocurrency from crypto exchange Binance since it was sued by the U.S. CFTC on Monday, blockchain data tracker Nansen said on Wednesday.

Coinbase Chief Legal Officer: There’s ‘A Lot to Unpack’ in CFTC’s Filing Against Binance

Fran Velasquez, CoinDesk

Paul Grewal added that despite its own issues with U.S. regulators, Coinbase is “not going anywhere” right now.

Coinbase Aims to Stay in Canada; Binance Could Be Poised to Exit Amid Regulatory Shakeup

Ian Allison, CoinDesk

The moves come as the country tightens rules for cryptocurrency exchanges.