Daily Archives: April 8, 2016

Dimon’s Call for Truce With Small Banks Gets a `No Thanks’

hands_clapping

Bravo to the small banks!

  • Regional lenders say interests not aligned with Wall Street
  • JPMorgan chief said banks of all sizes need to work together

Thanks, but no thanks.

That was the response of small banks after Jamie Dimon called for a truce this week between large and small lenders. The JPMorgan Chase & Co. chief executive officer said the industry needs to work together, particularly in Washington, to achieve its policy goals with Congress and regulators.

“Just because Jamie Dimon says ‘let’s sing kumbaya’ doesn’t mean community banks are going to just line-up like a Greek chorus,” said Camden Fine, president of the Independent Community Bankers of America, a lobbying group for small banks. “This is just an attempt to link the interests of mega banks to community banks in order to mitigate the political heat that is on them right now. CEO’s of all the too-big-to-fail banks are clearly worried about the political climate.”

Attacks on Wall Street haven’t dissipated eight years after the financial crisis, with calls to break up the U.S.’s largest banks a constant refrain on the presidential campaign trail. Adding to the chorus are small banks across the country who fault big lenders for a slew of new rules they now must follow that affect everything from mortgages to capital requirements. The friction has prompted small lenders to form new trade groups to push their own agenda in Washington.

Read on.

Panama Papers’ firm co-founder: We didn’t know

Juergen Mossack, co-founder of the firm at the center of the Panama Papers, didn’t know that associates of top politicians from around the world were using his company to help hide money, he told CNBC in a Friday interview.

Mossack Fonseca, the Panamian law firm under intense scrutiny because of the release of four decades of documents detailing the establishment of offshore companies for the global elite, has always sought to follow the laws in its jurisdiction, Mossack said. And, he added, if the firm had ever discovered its clients were tied to individuals like Russian President Vladimir Putin, it would’ve immediately stopped those dealings.

Still, Mossack was not appreciative of the recent data leak that has been dubbed the Panama Papers by the international media.

“We were alarmed because this is obviously something that shouldn’t be out there,” he told CNBC. “Private information is private and should remain private.”

Read on.

GE’s Jeffrey Immelt, Now Slamming Sanders, Once Said It Was His “Task to Outsource”

That old saying: Be careful what you say because it come back to bite you…

BACK IN 2014, in an interview with the magazine Chief Executive, General Electric Co. CEO Jeffrey Immelt explained that starting in the 1980s, “most of us” — i.e. GE executives — “saw it as our task to outsource manufacturing, to move it to low-cost countries. This continued through the 1990s and into the very early 2000s.”

Immelt’s statement of the obvious is relevant because Democratic presidential candidate Bernie Sanders said essentially the same thing about GE this week, which triggered an angry response from Immelt.

In a meeting on Monday with the New York Daily News editorial board, Sanders was asked to name a corporation that he believed was “destroying the fabric of our nation.” Sanders said that GE was a “good example” because it had shut down “many major plants in this country. Sending jobs to low-wage countries. … That is saying that I don’t care that the workers, here have worked for decades. … The only thing that matters is that I can make a little bit more money. That the dollar is all that is almighty.”

Immelt (or, more likely, his ghostwriter) replied in a Washington Post op-ed that “Sanders says that he is upset about GE’s operations abroad — as though a company that has customers in more than 180 countries should have no presence in any of them.”

This is, of course, intentionally misleading language: Sanders’s criticism was not that GE has established a “presence” in other countries, but that it has moved many of its factories there in order to save money by paying workers less.

As Immelt himself said in 2014, outsourcing became his task because “U.S. labor was expensive and materials were cheap.”

Read on.

Ex-Barclays trader stood to gain $172.50 bonus from alleged Libor fixing, court hears

An ex-Barclays trader accused of fixing a key financial benchmark for personal gain stood to earn a bonus of only $172.50 for his role in alleged rate-rigging in 2007, a London court heard on Friday.

Adrian Darbishire, lawyer for Ryan Reich, one of five men on trial for conspiracy to defraud by manipulating U.S. dollar Libor rates between June 2005 and September 2007, shared the estimated sum with the jury, in response to prosecution allegations that huge sums were involved.

“So what’s the loot? What’s the possible cash incentive?” Darbishire said on the opening day of defence arguments.

Britain’s Serious Fraud Office (SFO) has alleged that Reich, Barclays’ former rate submitter Jonathan Mathew and ex-traders Stylianos Contogoulas, Jay Merchant and Alex Pabon dishonestly agreed to procure or make false or misleading submissions of rates into the dollar Libor-setting process.

The five men have pleaded not guilty. Each count carries a maximum jail sentence of 10 years.

Read on.

MERS wins twice in Texas federal courts LENDINGSERVICING MERS wins twice in Texas federal courts

MERSCORP Holdings announced Thursday that it secured a pair of victories in federal court, as two United States District Courts in Texas recently upheld MERS’ mortgage assignment rights.

MERSCORP runs a private database of mortgage liens for use within the industry. Mortgage Electronic Registration Systems (MERS) serves as the mortgagee in the land records for loans registered on the MERS System, and the company has faced repeated legal challenges over its mortgage assignment authority.

But, the company often proves victorious in court, some of those victories can be read about here.

Read on.

Jamie Dimon declares mortgages bad for business

Dimon is certainly a piece of work. He, the board, and the company made so much profits screwing over the homeowners and foreclosing on their homes, hoodwinking the investors and shareholders and inheriting EMC Mortgage, subprime mortgage of Bear Stearns ,and purchasing of WAMU. Now, that the House of Morgan have been investigated and fined numerous times by the government for their crimes and the regulators are breathing down Dimon’s throat with government regulations,  Dimon is now doing an about face on staying in the mortgage business…

JPMorgan Chase CEO Jamie Dimon did more than predict a coming economic crisis in his yearly letter to shareholders.

In his letter, Dimon also openly questioned why the bank is still in the mortgage business, telling shareholders that one of the main reasons that the megabank is still engaged in mortgage lending is for the benefit of its customers, despite the “volatile” nature of the business and the “increasingly lower returns” coming from mortgages.

Dimon’s letter includes a section titled “Why are you still in the mortgage business?,” a question that Dimon says is a “valid” one given the current environment.

“The mortgage business can be volatile and has experienced increasingly lower returns as new regulations add both sizable costs and higher capital requirements,” Dimon writes.

“In addition, it is not just the cost of the new rules in origination and servicing, it is the enormous complexity of those new requirements that can lead to problems and errors,” Dimon continues. “It is now virtually impossible not to make some mistakes – and as you know, the price for making an error is very high.”

So why does JPMorgan Chase stay in the mortgage business? For its customers, Dimon says.

“Mortgages are important to our customers. For most of our customers, their home is the single largest purchase they will make in their lifetime,” Dimon writes.

Read on.

Banks told to declare links to Panama Papers law firm by next week

Financial Conduct Authority sets financial firms deadline to check if they have links to Mossack Fonseca

Banks and financial firms have been told to hand over any information about their dealings with the law firm at the centre of the Panama Papers to the UK’s Financial Conduct Authority by a week on Friday.

The City regulator had written to major financial firms on Monday, as the details of the accounts handled by the law firm Mossack Fonseca began to emerge, to ask what information banks held about any dealings with it and gave them 10 days to provide any details they may have.

Around 20 firms have received the correspondence from the FCA, which is responsible for regulating the City and has made tackling money laundering and financial crime one of its seven priorities for this year.

The 15 April deadline for information about dealings with Mossack Fonseca is contained in the letter, which also asks what action they are taking as a result of the release of the 11.5m files from the Panama-based law firm.

Read on.