DIRS.INFO The most relevant business & tech news

☆ FDIC Signals Support for Narrow Changes to Deposit Insurance
▼ + stars: | 2023-05-01 | by ( Andrew Ackerman | ) www.wsj.com time to read: 1 min

Lawmakers have discussed potentially raising the deposit-insurance limit from the current $250,000 per depositor. Photo: Elizabeth Frantz for The Wall Street JournalWASHINGTON—Lawmakers could reduce the risk of bank runs by significantly raising deposit-insurance protection for accounts used for payroll and other business payments, the Federal Deposit Insurance Corp. said in a report Monday. A targeted move to make sure businesses can get back money intended for such payments if a bank fails was the best of three options the FDIC considered for overhauling the deposit-insurance system, the agency said.

☆ Banks are finally admitting they have a problem with billions of dollars in looming real-estate defaults
▼ + stars: | 2023-05-01 | by ( Daniel Geiger | ) www.businessinsider.com time to read: +7 min

This earnings season, some major banks bucked tumult in the sector by raking in record revenues and surpassing Wall Street expectations. The bank separately disclosed $725 million of "non-accrual loans" tied to office assets — debts that are already delinquent on payments. That was a nearly fourfold increase in dollar volume of bad office loans over the previous quarter held by the bank. Even some loans tied the nation's robust market for apartment buildings have faltered recently. Anderson said about $760 billion of office loans were held by banks, which amounts to roughly 35% of their commercial-real-estate debt.

☆ FDIC calls for higher deposit insurance cap after bank failures
▼ + stars: | 2023-05-01 | by ( Elisabeth Buchwald | ) edition.cnn.com time to read: +2 min

New York CNN —The Federal Deposit Insurance Corporation is advocating for an increase in the deposit insurance limit for business payment accounts following the three recent bank failures. It also provided temporary unlimited deposit insurance to non-interest bearing accounts in the wake of the Great Recession. The agency’s proposal, outlined in a report it released Monday, did not specify what it thinks would be an appropriate increased level of deposit insurance for business payment accounts. The FDIC considered two other deposit insurance reforms: raising the insurance cap across all bank accounts, and extending unlimited deposit insurance to all accounts. Increasing the insurance cap on business payment accounts would likely result in increasing the premiums that banks pay to the FDIC.

☆ FDIC sees merits of increasing backstop for business accounts
▼ + stars: | 2023-05-01 | by ( ) www.cnbc.com time to read: +3 min

A key U.S. banking regulator on Monday laid out a range of options for reforming the federal deposit insurance system and concluded that significantly increasing the backstop for bank accounts used for business purposes was the "most promising." In the wake of March's lightning-fast bank failures, expanding coverage for accounts used to cover payroll, invoices and other large business transactions has emerged as the Federal Deposit Insurance Corp's preferred route for balancing financial stability and depositor protection, relative to its cost. Keeping the current system, where coverage is limited to $250,000 per-person per-bank, was the third option considered. The FDIC's deposit insurance fund helps to fulfill the agency's guarantee of bank deposits up to $250,000 per person. In the event an insured bank fails, the FDIC uses the deposit insurance fund to pay back customers who maintained accounts under the limit.

☆ What the First Republic takeover means for customers
▼ + stars: | 2023-05-01 | by ( Jeanne Sahadi | ) edition.cnn.com time to read: +3 min

New York CNN —First Republic Bank was taken over by the Federal Deposit Insurance Corporation on Monday, with most of its assets sold to JPMorgan Chase. Chase is assuming all deposits of First Republic customers. First Republic customers’ deposits will continue to be FDIC-insured. First Republic customers will have many of the same banking conveniences that they had before the bank was taken over. Direct deposits like paychecks and Social Security benefits will continue as usual,” the FDIC said on its resource page for First Republic customers.

If a bank fails, insured deposits will be moved to another FDIC-insured bank or paid out. Checking accounts, savings accounts, money market accounts, and certificates of deposit are examples of FDIC-insured bank accounts. Single bank accounts and joint bank accounts are examples of different ownership categories. If you want to keep more money in the bank than the FDIC will insure, you could open another bank account at a separate bank. Aside from First Republic, Silicon Valley Bank, and Signature Bank, the last bank failure happened in October 2020, when Alamena State Bank in Kansas was shut down.

The hedge funds said they can share ideas, but cannot reveal their trading positions for regulatory reasons. Reddy said he preferred senior unsecured bank debt, that allowed bondholders payment ahead of some other creditors in the event of an insolvency. Taking bearish positions on banks that lend to smaller and medium sized firms could prove opportunistic if the economy weakens, he added. Trend-wise the Japanese yen should continue to weaken," said Chua, noting that central banks in Asia have slowed or paused rate hikes. Insurers, which holds commercial mortgage-backed securities and property, will likely feel pressures on CRE, he said.

☆ Fed report on SVB collapse faults bank's managers — and central bank regulators
▼ + stars: | 2023-04-28 | by ( Jeff Cox | ) www.cnbc.com time to read: +6 min

Central bank officials likely will turn their attention to cultural changes, noting that risks at SVB were not thoroughly examined. Future changes could see standardized liquidity requirements to a broader range of banks, and tighter supervision of compensation for bank managers. "[T]he combination of social media, a highly networked and concentrated depositor base, and technology may have fundamentally changed the speed of bank runs,' he said in the report. "Social media enabled depositors to instantly spread concerns about a bank run, and technology enabled immediate withdrawals of funding." Fed Chairman Jerome Powell said he welcomed the Barr probe and its internal criticism of Fed actions during the crisis.

☆ The insurance limit on your savings has become a hot global debate
▼ + stars: | 2023-04-28 | by ( Julia Horowitz | ) edition.cnn.com time to read: +8 min

The US Federal Deposit Insurance Corporation insures deposits up to $250,000 per person, per account, using a fund that banks pay into. “I don’t think that’s served us well.”Some argue the US deposit insurance limit should be 100 times higher. What is deposit insurance? Deposit insurance is aimed at calming fears, giving customers less reason to pull their cash out in a hurry. The debate over deposit insurance taps into bigger questions about the state’s role in private enterprise.

☆ Factbox: Fed, FDIC reviews of US bank failures to spotlight problems, fixes
▼ + stars: | 2023-04-27 | by ( ) www.reuters.com time to read: +6 min

On Friday the banks' regulators - the Federal Reserve and the Federal Deposit Insurance Corporation - will publish their accounts of what happened at both institutions, and propose fixes to prevent a repeat. The FDIC will also publish a separate report on deposit insurance by Monday. Barr has said the Fed's report will include confidential supervisory information, including citations and exam material not typically disclosed. DEPOSIT INSURANCEThe second FDIC report could provide insight into how officials are thinking about the role of deposit insurance, currently capped at $250,000 per depositor, in financial stability. "The most interesting thing I expect to see is what the FDIC recommends about the deposit insurance cap," Phillips said.

☆ These 2 savings accounts have interest rates of about 5%: Here's which one you should choose
▼ + stars: | 2023-04-24 | by ( Mike Winters | ) www.cnbc.com time to read: +2 min

Compared to the average interest rate of 0.6% you get for checking accounts , moving money from your debit account into either one of these savings accounts can be a smart move. HYSAs have higher interest rates compared to regular savings accounts, and the best rates are typically offered by credit unions or smaller online banks. Several online banks currently offer interest rates of about 4.5%, which works out to $450 in annual interest for a balance of $10,000. That's about $400 more than what you could get before interest rates started rising last year. Typically, long-term CDs have slightly higher interest rates than short-term CDs.

☆ Here are 3 things Mohamed El-Erian is watching out for in earnings this week
▼ + stars: | 2023-04-24 | by ( Pia Singh | ) www.cnbc.com time to read: +2 min

In a market plagued by uncertainty, Mohamed El-Erian is turning to this week's earnings — from key technology names such as Microsoft and Alphabet , to industrial heavyweights General Electric and General Motors — for further clarity. "Given what we know, and especially what we don't know, I wouldn't bet against these markets. I wouldn't bet in favor of these markets," El-Erian, Allianz and Gramercy advisor and president of Queens' College, Cambridge University, said Monday on CNBC's "Squawk Box." When all is said and done, first-quarter earnings for companies in the entire index are estimated to decline 5.2%, however, per Refinitiv. Also due this week: U.S. first-quarter GDP, March's personal consumption expenditures price index (the Fed's favorite inflation gauge) and April's consumer sentiment data.

☆ Why the Banking Mess Isn’t Over
▼ + stars: | 2023-04-23 | by ( Nick Timiraos | ) www.wsj.com time to read: 1 min

Depositor runs on Silicon Valley Bank prompted customers at other small or regional banks to consider moving uninsured deposits to the big money-center banks. Photo: KORI SUZUKI/REUTERSThe panic phase of the past month’s banking crisis may be ending. The big question now is how much of a hit the economy faces from any lending pullback. The answer may not be clear for months. The failures of Silicon Valley Bank and Signature Bank one month ago disrupted an already fragile equilibrium because many banks hadn’t raised deposit rates as the Federal Reserve aggressively lifted short-term interest rates to fight high inflation.

☆ Rates on C.D.s Are Soaring, but the High Rates May Not Last
▼ + stars: | 2023-04-21 | by ( Ann Carrns | ) www.nytimes.com time to read: +2 min

You want to be able to withdraw the cash quickly if you need it, without worrying about paying a penalty. You may be better off getting a slightly lower rate in a high-yield savings account, with fewer restrictions on withdrawals. If you have a large expense coming at a known date in the future, however — say, a college tuition payment — a longer-term C.D. The paltry interest rates of recent years punished retirees, she said, so higher C.D. rates of 3 to 5 percent offer welcome relief: “We’re in this golden moment.”But given concerns about the economy and uncertainty about whether the Federal Reserve will continue raising rates, it’s unclear how long banks will continue to pay the high rates.

☆ US bank run victims were bailed out in 3 days. In China, many have been waiting a year
▼ + stars: | 2023-04-21 | by ( Selina Wang | ) edition.cnn.com time to read: +9 min

CNN is not revealing the identities of the bank victims in order to protect their safety. Bank victims protest in Henan in July 2022. Experts say small banks in other parts of China could face the same crisis, as the world’s second largest economy faces a longer term structural slowdown. Some Chinese bank victims even say they’re living in fear of violent reprisals. CNN interviews bank victims in China.

☆ Parking your cash in these investments is paying off: 3 ways to find the best place to hide
▼ + stars: | 2023-04-19 | by ( Darla Mercado | Cfp | ) www.cnbc.com time to read: +4 min

Apple, working with Goldman Sachs, entered the fray this week and launched a savings account with a 4.15% annual percentage yield. Even money market funds, where investors can park cash that's in their brokerage accounts, are paying attractive rates. With an array of places to earn yield, investors need to weigh a few factors before deciding where they ought to keep their cash. Note that the rate paid to you on a high-yield savings account can change once you've opened it. Meanwhile, savings accounts may not hit you with penalties – but you could still face limitations on the number of withdrawals and transfers from these accounts.

Apple has a new high-yield savings account from Goldman Sachs available for Apple Card users. The Apple Card Savings account pays a higher APY than the average savings account. The Apple Card Savings account is available for Apple Card users in the US. How the Apple Card Savings account worksThe Apple Card Savings account doesn't require a minimum opening deposit. Interest on the Apple Card Savings account is compounded daily and deposited into your account monthly.

☆ Bank of England considering urgent reform of deposit guarantee scheme, Financial Times reports
▼ + stars: | 2023-04-16 | by ( ) www.reuters.com time to read: +2 min

The UK’s Financial Services Compensation Scheme is being urgently reviewed after the rapid failure of Silicon Valley Bank last month, the FT added citing people briefed on the matter. The failure last month of Silicon Valley Bank and two other lenders in the United States, along with the forced takeover of Credit Suisse by UBS sent banking shares globally into a tailspin, but markets have since calmed. BoE Governor Andrew Bailey said last week that the British central bank was considering improvements to its approach to depositor pay-outs for smaller banks with a focus on the speed of the pay-outs. "As with all things relating to bank resolution, there is no free lunch." Reporting by Mrinmay Dey in Bengaluru; Editing by Chizu NomiyamaOur Standards: The Thomson Reuters Trust Principles.

☆ Marketmind: Banks to test soft landing thesis
▼ + stars: | 2023-04-14 | by ( ) www.reuters.com time to read: +4 min

A look at the day ahead in U.S. and global markets from Mike DolanWorld markets have surged this week on renewed hopes of disinflation, peak interest rates and a soft economic landing - and earnings from Wall Street's biggest banks now test the thesis. Markets will be most focussed on bank guidance on how much the March bank failure will crimp lending going forward. Next month's expected interest rate rise from the Federal Reserve is now expected to be the last and futures see up to 70 basis points of cuts from that point to year-end. And with China's booming trade numbers for last month also suggesting the world economy at large will comfortably skirt recession this year, "soft landing" hopes are back in vogue. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

☆ The Haslam family sold its gas station business to Warren Buffett this year. Now it's set to buy a stake in the Milwaukee Bucks.
▼ + stars: | 2023-04-14 | by ( George Glover | Theron Mohamed | ) www.businessinsider.com time to read: +3 min

The Haslam family will finalize buying a stake in the Milwaukee Bucks on Friday, according to Bloomberg. They're swapping fuel pumps for courtside seats after selling their gas station business to Warren Buffett. They're poised to own 25% of the Bucks in a deal that values the NBA franchise at around $3.5 billion. The Haslams agreed to buy billionaire investor Marc Lasry's 25% stake in the Bucks in a deal that values the NBA franchise at $3.5 billion back in February, per a previous Bloomberg report. The Haslam family retains control of Pilot's day-to-day operations.

☆ For some US banks, it’s still a wonderful life
▼ + stars: | 2023-04-13 | by ( John Foley | ) www.reuters.com time to read: +7 min

Bank customers are still sitting on a pile of savings manufactured by pandemic-era government stimulus and curtailed consumption. Among all banks, deposit balances have fallen 5% year-on-year; to get back to their pre-Covid trend, they’d need to fall 20%. What of small banks that can’t match either advantage? Better placed within communities to soothe the nerves of mostly local customers, small banks can instill trust and loyalty while allaying fears. This edge for small banks should also insulate them from the worst effects of a deposit price war.

☆ Buffett: Do not panic about U.S. banking industry
▼ + stars: | 2023-04-12 | by ( ) www.reuters.com time to read: +2 min

April 12 (Reuters) - Warren Buffett on Wednesday said people should not be panicked about the banking industry or the safety of U.S. bank deposits, despite the recent failures of Silicon Valley Bank and Signature Bank. People "do not need to be panicked" about the banking industry and "shouldn't be worried about deposits they have in an American bank," a message that has recently gotten "confused" and "mixed up," Buffett said. "It does really, really affect the system when people lose confidence in banks," he said. Silicon Valley Bank collapsed on March 10 after losses on fixed-income investments left it short of capital, triggering a bank run. Buffett was speaking from Tokyo, where he was visiting five large Japanese trading houses in which Berkshire has investments.

Another quarter-point increase is expected, but policymakers have also said they are watching banking data closely for signs of stress or a larger-than-anticipated drop in lending. The minutes "will likely express confidence in the separability of price stability and financial stability." Still, the events on that March 10 weekend added new complexity to a Fed policy debate that had been singlemindedly focused on lowering inflation from levels that last year were more than triple the Fed's 2% target. New consumer price index data released Wednesday is expected to show headline inflation falling, but with a still-high level of underlying or "core" inflation likely to concern Fed policymakers. Reporting by Howard Schneider; Editing by Andrea RicciOur Standards: The Thomson Reuters Trust Principles.

☆ Buffett: Do not panic about U.S. banks and deposits
▼ + stars: | 2023-04-12 | by ( Jonathan Stempel | ) www.reuters.com time to read: +2 min

April 12 (Reuters) - Warren Buffett said people should not be panicked about the banking industry or the safety of U.S. bank deposits, despite the recent failures of Silicon Valley Bank and Signature Bank. "People shouldn't be worried about losing their money and their deposits they have in an American bank, but the message has gotten very confused," Buffett, 92, said on CNBC. Berkshire's equity portfolio includes several banks, including a $34.2 billion year-end stake in Bank of America Corp (BAC.N). Buffett says banks have "mismanaged" assets and liabilities for a long time, and "every now and then it bites them in a big way." Buffett also said he would bet $1 million that no American depositor would lose money from a bank failure in the next year.

☆ Buffett says U.S. bank deposits are safe and the government would backstop all of them if necessary
▼ + stars: | 2023-04-12 | by ( Alex Harring | ) www.cnbc.com time to read: +2 min

Warren Buffett said Americans should not be concerned about their bank deposits in the wake of the latest financial shock in the sector and the government would ensure no depositor in this country lost a dime. Buffett said the government would likely step in to backstop all depositors in all U.S. banks if that was ever necessary, though he did note that would require Congressional approval. Bank stocks largely tumbled in March as investors grew skittish on the sector, with the selloff specifically focused on regional banks amid liquidity concerns. To restore confidence, 11 banks put $30 billion in deposits in First Republic Bank , whose shares have tumbled during the shock. Buffett noted that shareholders may lose out if more bank failures occur and rightly so, but depositors shouldn't be worried.

Search resuls for: "depositor"

25 mentions found