New York's Benjamin Lawsky and other state regulators have given no indication of differentiating between online lenders that operate well and those that dont. Yet the spectrum of alternative lending operations indicates that just such a distinction is needed.
Sons and Daughters: Documents, including spreadsheets and emails, shine some light on how hiring the children of prominent businesspeople in China may have helped JPMorgan Chase land business with state-controlled companies. For example, in one email a senior JPM banker in Hong Kong writes, "You all know I have always been a big believer of the Sons and Daughters program it almost has a linear relationship" with winning assignments. JPMorgan handed...
These types of schemes rarely pay off in the end, and they certainly never represent an efficient use of funding. Banks would, therefore, be well-advised to make some immediate price-structure changes.
Waiting for Volcker: News on the contents of the Volcker Rule continues to trickle in ahead of next week's vote on the long-awaited Dodd-Frank provision. The Journal reports that the rule will require bank executives to guarantee their firms are in compliance with the regulation, which, incidentally, marks another requirement banks lobbied against that wound up in regulators' final proposal. Meanwhile, an unnamed senior Treasury official tells the FT the rule will...
As consumer groups turn their attention to smaller institutions, they bring lending disparities to regulators attention. The regulators seem to take these issues more seriously than during bank megamergers heyday.
There seems to be undue emphasis being placed on a provision that, generally, would have done nothing to avoid the recent financial crisis. Ultimately, however, the Volcker Rule has to be judged like any other regulation: do its benefits outweigh its costs?
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