Blog Entries tagged 'Banking' Blog Entries tagged 'Banking' http://www.cfozone.com Tue, 14 May 2013 19:17:35 +0100 FeedCreator 1.7.2 Should banks give up the payments game? http://www.cfozone.com/index.php?option=com_myblog&show=When-banks-no-longer-handle-payments...html&Itemid=713

In a blog Thursday on FinanSer--the Financial Services Club blogsite—commentator Chris Skinner posed the following question: Since payments are becoming so commoditized that it is foreseeable at some point they may become free, what does this do to the role of a bank as an intermediary in the payments business?

Skinner suggests that banks should and are moving towards becoming repositories of information, as they are further disinter [...] denise.bedell@tc-worldwide.com Wed, 06 Oct 2010 23:00:00 +0100 SWIFT payments Google electronic bank account management eBAM cash management Cash banking industry Banking Why Herz's retirement may be bad for accounting http://www.cfozone.com/index.php?option=com_myblog&show=Why-Herzs-retirement-may-be-bad-for-accounting.html&Itemid=713

The retirement of FASB's long-serving chairman is no surprise. Eight years is a long time at the helm, especially when the last two involved a serious banking crisis in which accounting was a central concern. But Bob Herz kept a stiff upper lip and gave little quarter, even when playing defense and compromising where he had to.

When I interviewed Herz's predecessor, Ed Jenkins, he had clearly been through the ringer on everything from derivatives accounting to Enron. And it show [...] ronaldfink6@gmail.com Wed, 25 Aug 2010 23:00:00 +0100 Securities and Exchange Commission GAAP finanacial reporting FEI FASB compliance Banking Accounting Trups will no longer count as banks' Tier 1 capital http://www.cfozone.com/index.php?option=com_myblog&show=Trups-will-no-longer-count-as-banks-Tier-1-capital.html&Itemid=713

The Dodd-Frank financial reform is allowing banks to redeem trust preferred securities at face value for 90 days. So far, large banks haven't used the redemption provision and they may not take the opportunity at all.

The new law is offering this option as trust preferred securities, also called Trups, will no longer qualify as Tier 1 capital. The exclusion will begin in 2013.

There are currently about $118 billion of Trups outstanding that were issued by banks including [...] marinecole@hotmail.com Mon, 23 Aug 2010 23:00:00 +0100 Risk hybrids financial reform Deals Banks Banking Banks reduce Level 3 assets http://www.cfozone.com/index.php?option=com_myblog&show=Banks-reduce-Level-3-assets.html&Itemid=713

Large US banks have reduced hard-to-value Level 3 assets since the beginning of the year, according to quarterly filings, but it doesn't mean their balance sheets are in better shape.

The decline was modest for some banks, especially compared with the sharp improvement in 2009 when banks raised equity and reduced leverage. In addition, the recent requirements to consolidate off-balance sheet vehicles helped remove some assets from the Level 3 bucket--but only to reclassify them [...] marinecole@hotmail.com Sun, 22 Aug 2010 23:00:00 +0100 securitization Risk fair value Banks Banking More trouble for banks http://www.cfozone.com/index.php?option=com_myblog&show=More-trouble-for-banks.html&Itemid=713

This trend has now reached California, so it's about to become a whole lot more meaningful.

Again, this may be a matter of paperwork, but at minimum, it seems like banks will have to spend time and money straightening out their claims to homes on loans they've securitized.

The problem has to do with the electronic record keeping system involved, known as the Mortage Electronic Recordkeeping System (MERS). But it's not just a technicality. How can anyone claim a right t [...] ronaldfink6@gmail.com Thu, 19 Aug 2010 23:00:00 +0100 Supreme Court securitization Risk mortgages mortgage foreclosures loan losses compliance Citigroup Citi California Banks Banking Why regulators shouldn't listen to economists http://www.cfozone.com/index.php?option=com_myblog&show=Why-regulators-shouldnt-listen-to-economists-7562.html&Itemid=713

This brouhaha over the Boston Fed's rationalization for missing the housing bubble reminds me of a conversation I overheard a few weeks ago between a former Federal Reserve bank supervisor and his counterpart at the New York Fed.

I can't give you their names since they were conversing privately a few feet away from me before the start of a conference on financial regulation (nor can I give you the name of the confab since that would give their identities away), and I just manag [...] ronaldfink6@gmail.com Tue, 17 Aug 2010 23:00:00 +0100 Risk Regulation New York Fed financial crisis Federal Reserve Fed compliance Banks banking reform Banking bank failures JPMorgan, Cablevision case creates CDO uncertainty http://www.cfozone.com/index.php?option=com_myblog&show=JPMorgan-Cablevision-case-creates-CDO-uncertainty.html&Itemid=713

A recent court decision involving JPMorgan and Mexican cable operator Empresas Cablevision sent another blow to the securitization market, and especially to collateralized loan obligations (CLOs), but gave more of a say to borrowers when lenders want to pass on their loans to others. It could have a broad-reaching impact on structured financings.

At the end of July, the US District Court for the Southern District of New York invalidated a participation granted by JPMorgan to another ban [...] marinecole@hotmail.com Sun, 15 Aug 2010 23:00:00 +0100 securitization JPMorgan Deals compliance collateralized debt obligation CLOs cable Banks Banking Getting what you wish for http://www.cfozone.com/index.php?option=com_myblog&show=Getting-what-you-wish-for.html&Itemid=713

As part of the financial overhaul, federal banking agencies have jumpstarted the process of finding alternatives to using credit ratings for calculating banks' capital levels. But alternatives are few and far between and some could be expensive too.

The various bank agencies - the Federal Reserve, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and the Office of Thrift Supervision - are seeking to gather information and comments on alterna [...] marinecole@hotmail.com Tue, 10 Aug 2010 23:00:00 +0100 Risk ratings agencies Federal Reserve FDIC Credit Ratings compliance Capital Banking Why Tim Geithner should ignore the banks http://www.cfozone.com/index.php?option=com_myblog&show=Why-Tim-Geithner-should-ignore-the-banks.html&Itemid=713

Banks' arguments against stricter capital reserve requirements seem to be getting a hearing from regulators such as Tim Geithner and the Basel Committee, but a recent paper suggests they should not.

This was alluded to in a blog today by Simon Johnson over at the Baseline Scenario, but the relevant passages are worth reading.

The paper isn't authored by lightweights but by Samuel Hanson and Jeremy Stein of Harvard and Anil Kashyap of the University of Chicago.

Here& [...] ronaldfink6@gmail.com Wed, 04 Aug 2010 23:00:00 +0100 Timothy Geithner Goldman Sachs financial reform financial crisis Dodd-Frank bill compliance Banks banking reform banking industry Banking When confidence is merely a con http://www.cfozone.com/index.php?option=com_myblog&show=When-confidence-is-merely-a-con-.html&Itemid=713

A column published on Tuesday by Project Syndicate sums up the world's flailing (if not downright cynical) response to the financial crisis in particularly apt terms, I'd say.

The governments' efforts to restore confidence in the banking sector without really addressing the causes of its loss of confidence is akin to trying to tickle oneself, observed Paul Seabright of the University of Toulouse in the piece, entitled "Financial History's False Lessons." ronaldfink6@gmail.com Tue, 03 Aug 2010 23:00:00 +0100 Timothy Geithner Regulation Obama Administration financial crisis EU compliance Banks banking reform banking industry Banking bailouts The battle to reform banks is far from over http://www.cfozone.com/index.php?option=com_myblog&show=The-battle-to-reform-banks-is-far-from-over.html&Itemid=713

Anyone who thinks the financial reform bill is all that was necessary to finish fixing the banking system needs to read a couple of pieces published in recent days.

As Simon Johnson points out over at Baseline Scenario, a new paper by several respected academics shows that the stiffer capital requirements that the Obama administration is focused are not only easily gamed, but can have major unintended consequences, and these can amount a repeat of the systemic crisis we saw two years ag [...] ronaldfink6@gmail.com Wed, 28 Jul 2010 23:00:00 +0100 Risk Regulation Obama Administration Federal Reserve compliance Banks banking reform Banking The financial crisis is only "on pause" http://www.cfozone.com/index.php?option=com_myblog&show=The-financial-crisis-is-only-on-pause-.html&Itemid=713

There's some additional recent work out there that's worth citing in connection with Karen's post on Tuesday.


In particular, I would point readers to the piece posted Monday on voxeu.org by Enrico Perotti, a finance professor at the Amsterdam Business School. Essentially, Perotti's piece explains why Kotlikoff's prescription is necessary. As it did the US Congress, the banking industry has fought off international attempts to get the so-called Basel Committee to force the indust [...] ronaldfink6@gmail.com Tue, 06 Jul 2010 23:00:00 +0100 Volcker Rule Risk Regulation Obama Administration financial market reform financial crisis Congress compliance Banks banking reform Banking bailouts It's not such a wonderful life http://www.cfozone.com/index.php?option=com_myblog&show=Its-not-such-a-wonderful-life.html&Itemid=713 In his new book, "Jimmy Stewart is Dead: Ending the World's Ongoing Financial Plague with Limited Purpose Banking," author Laurence Kotlikoff outlines his view of the drivers behind the financial mess and then offers up a solution with limited purpose banking.
  
 To be sure, the causes behind the ongoing financial crisis that Kotlikoff identifies are similar to what many other economists, journalists and regular Joes - especially on the web -  have i [...]
karen@karenkroll.com Mon, 05 Jul 2010 23:00:00 +0100 Glass Steagall Act Federal Reserve Federal Deposit Insurance Corp. Banking AIG
AIG vs. Goldman reveals the flaw in financial reform http://www.cfozone.com/index.php?option=com_myblog&show=AIG-vs.-Goldman-reveals-the-flaw-in-financial-reform.html&Itemid=713

The latest revelations  concerning the dispute between AIG and Goldman over collateral show how weak the new financial reform package really is.

After all, Goldman's demands for collateral from AIG as it was failing ended up costing taxpayers billions of dollars. Yet according to the testimony today during the crisis panel's latest hearings, the whole question hinged on what constituted fair value.

 To hear Goldman CFO David Viniar tell it, the Vampire Squid can [...] ronaldfink6@gmail.com Wed, 30 Jun 2010 23:00:00 +0100 Risk Regulation Goldman Sachs GAAP financial reform bill financial market reform financial crisis FASB derivatives credit default swaps Congress compliance Banks banking reform Banking bank failures bailout AIG Accounting Bad governance at root of crisis http://www.cfozone.com/index.php?option=com_myblog&show=Bad-governance-at-root-of-crisis-7142.html&Itemid=713

Anyone counting on regulation alone to prevent the world from falling into another financial black hole will be sorely disappointed, a group of experts warned in an article published yesterday by the International Federation of Accountants.

The experts say that all key parties to the financial disaster--from regulators to managers and investors--share the blame and that tighter regulation alone can therefore go only so far to prevent another crisis from materializing. 

& [...] ronaldfink6@gmail.com Tue, 29 Jun 2010 23:00:00 +0100 Risk Regulation financial reform financial market reform financial crisis executive compensation derivatives corporate culture compliance compensation Banks banking industry Banking bank failures auditors Accounting Bad governance at root of crisis http://www.cfozone.com/index.php?option=com_myblog&show=Bad-governance-at-root-of-crisis.html&Itemid=713

Anyone counting on regulation alone to prevent the world from falling into another financial black hole will be sorely disappointed, a group of experts warned in an article published yesterday by the International Federation of Accountants.

The experts say that all key parties to the financial disaster--from regulators to managers and investors--share the blame and that tighter regulation alone can therefore go only so far to prevent another crisis from materializing. 

& [...] ronaldfink6@gmail.com Tue, 29 Jun 2010 23:00:00 +0100 Risk Regulation financial reform financial market reform financial crisis executive compensation derivatives corporate culture compliance compensation Banks banking industry Banking bank failures auditors Accounting Financial reform bill far from toothless http://www.cfozone.com/index.php?option=com_myblog&show=Financial-reform-bill-far-from-toothless-.html&Itemid=713

While many critics claim the financial regulation bill that emerged from Congressional negotiations on Friday will do next to nothing to reduce the chances of another banking crisis, there are some limits on risk taking that could do just that.

The one that strikes me as the toughest and most critical is the so-called Lincoln amendment, which would require banks to separately capitalize their trading in credit default swaps, which were central to the recent crisis.

Whil [...] ronaldfink6@gmail.com Sun, 27 Jun 2010 23:00:00 +0100 Volcker Rule Risk Paul Volcker financial crisis derivatives credit default swaps Congress compliance CDS Banks banking reform Banking bank failures BDO wins new trial in case involving Banco Espirito Santo http://www.cfozone.com/index.php?option=com_myblog&show=BDO-wins-new-trial-in-case-involving-Banco-Espirito-Santo.html&Itemid=713

Submitted by Caleb Newquist, republished from Going Concern, Accounting News for Accountants and CFOs.

In what amounts to a huge win for BDO, the Florida 3rd District Court of Appeal in Miami has ordered a new trial in the case between BDO and Banco Espirito Santo:

A Florida appeals court has thrown out a $521 million jury verdict and ordered a new trial in a dispute over audits between accounting firm BDO Seidman and a major Portuguese bank.

The Third District Court of Appe [...] jobs@cfozone.com Wed, 23 Jun 2010 23:00:00 +0100 compliance Banks Banking auditors auditing audit Accounting Letting Geithner off easy on the TARP http://www.cfozone.com/index.php?option=com_myblog&show=Letting-Geithner-off-easy-on-the-TARP.html&Itemid=713

Tim Geithner once again says taxpayers are getting a good return on the funds they provided banks through the Troubled Asset Relief Program.

And his line about 75 percent of the money being repaid may be true enough. It may even reflect this uncomfortable fact.

But 91 banks missing their dividend payments last month is hardly something to write home about.

I'll let Yves Smith go on about how bad the deal was for taxpayers from the  go.

(But here's the mon [...] ronaldfink6@gmail.com Tue, 22 Jun 2010 23:00:00 +0100 Timothy Geithner TARP Obama Administration financial market reform financial crisis Congressoinal Oversight Panel compliance Banks banking reform Banking bailouts Bank of Wal-Mart http://www.cfozone.com/index.php?option=com_myblog&show=Bank-of-Wal-Mart.html&Itemid=713

Wal-Mart is finally moving into the financial services business.

The discounting giant, whose efforts to get a bank license in the United States have repeatedly been thwarted since 1999, may have found a roundabout way to beat the opposition and get its hands on a banking asset – by buying a stake in financial services company Green Dot, which in turn has a stake in a small bank.

Wal-Mart executives have long maintain [...] denise.bedell@tc-worldwide.com Wed, 16 Jun 2010 23:00:00 +0100 Wal-Mart retailers prepaid cards Deals Canadian banking sector banking license Banking