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Apr 13, 2013

Analysis: JPMorgan’s lukewarm results put Dimon under more pressure

NEW YORK (Reuters) – JPMorgan Chase & Co Chairman and CEO Jamie Dimon, who came through the financial crisis relatively unscathed, is suddenly looking a little less secure.

The top U.S. bank by assets reported tepid first-quarter results on Friday. Income in its biggest businesses – investment banking and consumer lending – fell, excluding accounting adjustments. Outstanding loans grew by just 1 percent, and profit margins on lending narrowed. Stock and bond trading revenue fell.

Apr 13, 2013

JPMorgan’s lukewarm results put Dimon under more pressure

NEW YORK, April 13 (Reuters) – JPMorgan Chase & Co
Chairman and CEO Jamie Dimon, who came through the financial
crisis relatively unscathed, is suddenly looking a little less
secure.

The top U.S. bank by assets reported tepid first-quarter
results on Friday. Income in its biggest businesses – investment
banking and consumer lending – fell, excluding accounting
adjustments. Outstanding loans grew by just 1 percent, and
profit margins on lending narrowed. Stock and bond trading
revenue fell.

Apr 12, 2013

JPMorgan net up as “Whale” fades, but key units tepid

NEW YORK (Reuters) – JPMorgan Chase & Co posted higher first-quarter profit on Friday as it spent less money on litigation, but most of its major businesses turned in tepid performances, and the bank’s overall revenue declined.

The results reflected the pressure the largest U.S. bank is under even as it recovers from the disastrous “London Whale” trading losses that cost more than $6 billion last year.

Apr 4, 2013
via Unstructured Finance

“I’m from the Treasury, and I’m here to help”

Photo

Ronald Reagan famously said that the “nine most terrifying words in the English language are, ‘I’m from the government and I’m here to help.’” But according to a report from SNL, the government may actually help banks when it forces them to add directors to their boards. Every bank CEO’s worst nightmare is having the government name directors to his or her board. Usually, banks pack their boards with clients or prominent people that offer prestige and potential business leads, but little substantive oversight. At the smaller banks that SNL is focusing on, that often amounts to people like the owner of the local car dealership, or the owner of the local golf equipment seller. (For a stereotypical example of a community bank’s directors, consider the board of Smithtown Bancorp, which was sagging under the weight of failed loans before being taken over by People’s United Bank in 2010.)
The Treasury, on the other hand, tends to appoint people with actual banking experience, who can do what board members are supposed to do: keep an eye on management for the benefit of shareholders. The government only does so for banks that have lost their way: the Treasury has the right to name directors to boards of banks that received bailout money under the Troubled Asset Relief Program, and that missed six quarters of dividend payments. Typically, these appointees are bankers with more than 20 years of experience.
By SNL’s reckoning, the banks with Treasury-appointed directors have racked up median stock gains of 50.38 percent since taking on the new board members, compared with a median gain of 28.22 percent in an index of bank stocks.
Of course there may be other reasons for this outperformance – for example, it may be that small bank stocks in general have outperformed larger bank stocks over the relevant time frame, or that relatively weak banks have been in greater demand from value investors betting on an improving economy. But it may also be that the government has found a fix for the principal-agent problem at banks that have stumbled into trouble.

Feb 8, 2013

Exclusive: CIT has explored possible sale – sources

NEW YORK (Reuters) – CIT Group Inc (CIT.N: Quote, Profile, Research, Stock Buzz) had preliminary talks over the past year and a half to sell itself to banks, including Toronto-Dominion Bank (TD.N: Quote, Profile, Research, Stock Buzz) and Wells Fargo & Co (WFC.N: Quote, Profile, Research, Stock Buzz), but nothing came of the conversations, according to three people familiar with the specialty finance company.

Goldman Sachs (GS.N: Quote, Profile, Research, Stock Buzz) bankers have had informal talks on behalf of CIT with a number of banks, but the Wall Street firm has not been formally retained as an adviser, according to two of the people. CIT Chief Executive Officer John Thain, who formerly worked at Goldman, is not under any immediate pressure to sell the company, the sources said.

Feb 8, 2013

CIT has explored possible sale -sources

NEW YORK, Feb 8 (Reuters) – CIT Group Inc had
preliminary talks over the past year and a half to sell itself
to banks, including Toronto-Dominion Bank and Wells Fargo
& Co, but nothing came of the conversations, according
to three people familiar with the specialty finance company.

Goldman Sachs bankers have had informal talks on
behalf of CIT with a number of banks, but the Wall Street firm
has not been formally retained as an adviser, according to two
of the people. CIT Chief Executive Officer John Thain, who
formerly worked at Goldman, is not under any immediate pressure
to sell the company, the sources said.

Jan 18, 2013

Bank of America’s Moynihan, known for fixing and cutting, must now build

By Rick Rothacker and Dan Wilchins

(Reuters) – Bank of America Corp’s (BAC.N: Quote, Profile, Research, Stock Buzz) Brian Moynihan is known as a problem-fixer and cost-cutter and in his three years as the bank’s CEO, he has had that reputation tested like never before.

Now, proof of his abilities is beginning to show. On Thursday, the bank said its mortgage lending volume was growing and expenses were falling in the unit that handles problem home loans. Both are early signs that the second-largest U.S. bank is finally moving past its disastrous 2008 purchase of subprime lender Countrywide Financial.

Jan 18, 2013

BofA’s Moynihan, known for fixing and cutting, must now build

Jan 18 (Reuters) – Bank of America Corp’s Brian
Moynihan is known as a problem-fixer and cost-cutter and in his
three years as the bank’s CEO, he has had that reputation tested
like never before.

Now, proof of his abilities is beginning to show. On
Thursday, the bank said its mortgage lending volume was growing
and expenses were falling in the unit that handles problem home
loans. Both are early signs that the second-largest U.S. bank is
finally moving past its disastrous 2008 purchase of subprime
lender Countrywide Financial.

Nov 28, 2012

The biggest struggle yet for Citi’s repairman

By David Henry and Rick Rothacker and Dan Wilchins

(Reuters) – When Citigroup Inc’s board of directors was looking for a chief executive in 2007, it called Michael O’Neill, who had turned around Bank of Hawaii Corp a few years before.

O’Neill spoke to a Citigroup board member on the telephone, but the board was reluctant to consider O’Neill seriously because he had never run a bank of Citigroup’s size or complexity, according to a person familiar with the situation.

Nov 28, 2012

Analysis – The biggest struggle yet for Citi’s repairman

By David Henry and Rick Rothacker and Dan Wilchins

(Reuters) – When Citigroup Inc’s (C.N: Quote, Profile, Research) board of directors was looking for a chief executive in 2007, it called Michael O’Neill, who had turned around Bank of Hawaii Corp (BOH.N: Quote, Profile, Research) a few years before.

O’Neill spoke to a Citigroup board member on the telephone, but the board was reluctant to consider O’Neill seriously because he had never run a bank of Citigroup’s size or complexity, according to a person familiar with the situation.

    • About Dan

      "Dan Wilchins oversees a team of reporters covering U.S. commercial banks, investment banks, and insurance companies. Based in New York, he has also covered securitization, derivative markets, and corporate bonds."
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