 Earnings season is upon us, the time when corporations must take stock of all that took place over the past calendar year, and when all is tallied up, decide whether it was a good year or a bad one. From these calculations, they must make plans for the next year: promises to their shareholders that they’ll improve upon their flaws, however major or minor they may be. It’s like New Year’s Resolutions, if they only had to do with money.
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MetLife announced Tuesday that GE Capital, General Electric’s finance wing, will be purchasing MetLife Bank, the deposit banking part of the massive life insurance company. MetLife announced earlier this year that they were planning on selling their bank so that they may circumvent new federal regulations on deposit banking.
The city government of the District of Columbia is considering a measure that would move city cash out of megabanks and into local banks, in an effort to stimulate local business lending, reports the Washington Business Journal. The bill would require the District’s CFO to move a significant amount of city capital into local banks, and these local banks would be required to originate small business loans totaling twice the amount of city funds deposited. The proposed law was introduced earlier this month.
One of the most popular perks offered by credit cards has to be miles. But if you’re anything like me, deciding on one airline to use may be difficult. As more and more customers seek tailored programs to fit their travel needs, credit card issuers are rising up to the occasion.
The Wall Street Journal reports on a disturbing new trend in the credit card industry: partnerships between debt collection agencies and credit card issuers that reincarnate old debts, in exchange for extending credit to underqualified borrowers.
As financial institutions will no longer sell paper savings bonds, the Treasury has upped the purchase limit of electronic Series EE and I savings bonds so that investors retain their savings potential.
In his first move as the first director of the Consumer Financial Protection Bureau, Richard Cordray has introduced the Bureau’s Nonbank Supervision Program. The Bureau wants banks and nonbanks — non-traditional financial services providers like payday loan providers and prepaid card corporations — to “play by the same rules.”
It’s never easy returning to work after New Year’s. Conventional wisdom has it that your first day back at work after the new year is the most depressing day of the year. If you think you had a rough week, think again. You probably don’t work for Bank of America’s PR division, and they had the worst week ever, as far as we’re concerned.
In order for any business to be successful there has to be a strong business model. Love them or hate them, banks — thus far — have clearly had a strong business model. But as laws and regulations change, it’s time for U.S. banks to take a second look at their foundations.
Shadow banking, beware: your days in the shadows might soon be coming to an end. The Financial Stability Board, the Switzerland-based regulatory body created by the G-20, is considering expanding its definition of ‘too-big-to-fail’ beyond just massive banks. Meanwhile, Citibank’s CEO penned an op-ed for the Financial Times suggesting a different market-based method whereby financial regulators might reduce the systemic risk posed by these non-banks.
The identifying characteristic of an online bank is the lack of physical branches. Without the brick and mortar presence, online banks are able to offer low-cost accounts with attractive rates. They are missing out on the marketing opportunities that major national banks have with retail locations. But, that’s starting to change.