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February 15, 2013

News for the retail banking industry

Top Story

Study touts strength of financial industry
Banks ended 2012 with their highest annual profit since 2008 and continue to boost capital, putting the industry's Tier 1 common capital ratio at 12.6%, according to a report from Hamilton Place Strategies. With $10 trillion in deposits, banks are ready to lend, said CBA President and CEO Richard Hunt. He said loans and leases are higher than they were before the financial crisis. Meanwhile, consumers appear ready to spend more after a slowdown. Bloomberg (2/14), The Sun News (Myrtle Beach, S.C.)/McClatchy Newspapers (2/14), Politico Pro (subscription required) (2/14)

The CFPB Today

Warren takes regulators to task for not prosecuting big banks
Sen. Elizabeth Warren, D-Mass., criticized financial regulators Thursday for not being tough enough on big banks and taking them to trial. "The question I want to ask is how tough you are and how much leverage you really have," Warren said in her first Senate banking committee hearing, at which regulators were testifying. "If a party is unwilling to go to trial, either because they're too timid or lack resources, the consequence is they have a lot less leverage in all the settlements." The Hill/On the Money blog (2/14), Politico Pro (subscription required) (2/14), Reuters (2/14)

Retail Banking Roundup

Demchak will take over as CEO at PNC Financial
William Demchak will be the next CEO at PNC Financial Services Group, replacing retiring executive James Rohr on April 23. Demchak, who has been at PNC since 2002, will also join the board of directors. Rohr will become executive chairman. Bloomberg Businessweek (2/15), AmericanBanker.com (subscription required) (2/14)

M&T lets customers decide on checking account features
M&T Bank is offering customers the ability to customize their checking accounts with services they want for a $4.95 monthly fee. Options include overdraft protection and safe deposit boxes. AmericanBanker.com (free registration) (2/14)

Industry News

Crowdfunding becomes option for small-business loans
While many traditional lending sources remain tightfisted, small businesses are finding an alternative in crowdfunding. This article looks at SoMoLend and how it is navigating the legislative and market environment to help small businesses get capital. Some banks have climbed onboard. KeyBank says it will lend $1 million to $50 million using SoMoLend. Forbes (2/13)

Legislative Affairs

Democrats push back on criticism of CFPB structure and funding
All but one Democratic senator, as well as two Independent senators, have sent a letter to President Barack Obama supporting the Consumer Financial Protection Bureau's structure and funding and vowing to block any Republican effort to change them. The GOP's talk of filibustering Director Richard Cordray's nomination in order to change those things is "irresponsible and inconsistent with our democratic values," the letter says. The Hill/On The Money blog (2/14)

20% down payment rule is too rigid, senators say
Regulators need to revise the proposed qualified-mortgage rules because they are "overly rigid" and will impede home ownership, say Sens. Kay Hagan, D-N.C., Mary Landrieu, D-La., and Johnny Isakson, R-Ga. They are asking regulators not to require a 20% down payment and instead to rely on a borrower's ability to repay the loan. The Hill/RegWatch blog (2/14)

Democrats urge support for $110B sequester plan
An equal amount of spending cuts and additional tax revenue are included in a $110 billion sequester-replacement bill being introduced by Senate Democrats. The plan is aimed at replacing $85 billion in automatic spending cuts due to hit March 1. However, congressional Republicans oppose tax increases as part of any sequester alternative. The Hill/On The Money blog (2/14), The Huffington Post (2/14)

Career Development

Are you falling behind, or do you just think you are?
While it's useful to compare yourself to colleagues, keep in mind that such comparisons are more complicated than they seem, Rhymer Rigby writes. For instance, someone working at a different firm may be making more money than you, but their schedules might not be as flexible. "Similarly, some metrics can be deceptive: a colleague may earn more than you for no reason other than that they drive a harder bargain," Rigby writes. Fast Company online (2/13)

CBA Connect

CBA's Banking on Youth Competition -- Call for Sponsors

Now is your chance to join fellow bankers to support the 2013 Banking on Youth Competition. The program's inaugural year was a great success with 13 sponsoring banks and more than 170 entries from youth teams across 33 states. Sponsorship opportunities for 2013 are still available, ranging from $3,000 to $40,000. Visit our website and learn how you can support this growing competition and connect with America's young entrepreneurs to build sustainable ventures. Contact CBA for more information.

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If you want to live a happy life, tie it to a goal. Not to people or things."

--Albert Einstein,
German-born theoretical physicist

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