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Tag: banks
Nobody overdoes it like the Fed, except maybe the fiscal side of Government. Not only does the Bank Term Funding Program (BTFP) make bank collateral owned as of March 12th whole, the BTFP has a more attractive rate (at today's rate), compared to the Fed's discount window. When a bank borrows from the Fed's discount … Continue reading Expect Banks To Borrow Heavily from BTFP
If the U.S. was to experience a widespread bank run, that would be the time for the Federal Reserve to expand the money supply, thereby providing liquidity to commercial banks such that they may meet depositor withdrawals. Thus far SVIB and SBNY have been closed by the FDIC. Apparently that was too much for Fed … Continue reading Bail Out
The Monetary Base (currency in circulation plus bank reserve balances), continues to shrink, declining to its lowest level in October since January of 2021 (see charts below). The Monetary Base is down approximately 17% from its peak in December 2021, driven by lower bank reserves (down 27% in October from their high in September 2021), … Continue reading The Shrinking Monetary Base
The percentage of domestic banks that have tightened credit standards for auto loans has ticked up into positive territory (1.9%), for the first time since Q4 2020. This figure was negative from Q1 2021 through Q2 2022. Net Percentage of Domestic Banks Tightening Standards for Auto Loans: Click HERE for detail.
The Federal Reserve's forthcoming digital U.S. Dollar, also known as a Central Bank Digital Currency ("CBDC") will position the Federal Reserve as one of the world's largest FinTech companies. It also means less privacy for consumers and more competition for traditional banks and fintech companies. Central Bank Digital Currencies such as China's digital Yuan and … Continue reading The Federal Reserve Is A FinTech Company In The Making
Last night it was reported that M&T Bank (tkr: MTB) would acquire People's United (tkr: PBCT) for more than $7 billion. These "scale" acquisitions between regional banks simply delay the inevitable. What is required is the hard work of evolving business models and service delivery capabilities. More of the same won't suffice. Regional banks are … Continue reading Banks Need To Try Something New
Mass Mutual and Athene made a bid for American Equity Investment Life. Activist Trian took stakes in Invesco and Janus in an effort to build one of the largest Asset Managers. M&A is a quick way to scale AUM, but it does not change the paradigm for legacy Asset Managers. Legacy Asset Managers (and depository … Continue reading Consolidation Will Not Save Asset Managers
Congress will vote on a $484 Billion stimulus plan later this week which includes $250 Billion for the Paycheck Protection Program ("PPP") and $60 Billion for the SBA's Disaster Relief Fund. Congress and the Trump administration are racing to approve this stimulus package. The speed to execute this stimulus is driven by the fact that … Continue reading Expect More SMB Failures Despite Latest $310B SBA Relief
The SBA lacks the infrastructure to efficiently process the $350 billion capital allotment it received from the recent $2 trillion economic stimulus plan (read our breakdown here). The SBA's loan origination Website is overwhelmed from a bandwidth standpoint. The SBA's Website regularly times out or crashes before providing loan origination IDs to bank partners. It … Continue reading SBA Loan Processing – Every Which Way But Smooth
Stripe - the payments API company that revolutionized ecommerce payments infrastructure - launches “Stripe Capital”, a commercial credit service that will lend to Stripe customers. Stripe Capital will have two key advantages over traditional Financial Institutions (“FIs”). First, Stripe is present at the point of sale, providing it insight into payments flow before the transaction … Continue reading Stripe Capital – The Latest Fintech Disruptor
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