MONDAY JUNE 28, 2021 VOL. 186 No. 122 AMERICANBANKER.COM Follow us on Twitter @AmerBanker Biden appoints Sandra 5 Thompson acting FHFA director Thompson, who was most recently the CCAR results: 2021 deputy director of the FHFA’s Division Foreign-owned and custody were among the most of Housing and Mission Goals, replaces well-capitalized companies as ranked by projected minimum Mark Calabria, who was fired Wednesday common equity Tier 1 ratios afternoon. Page 5 See story on page 2 House follows Senate 6 in rejecting OCC’s Deutsche 23.2% ‘true lender’ rule UBS Americas 20.1% Credit Suisse 15.9% The House voted on Thursday to dismantle a Barclays US 15.7% TD Group 15.2% Trump-era rule that sought to make it easier Morgan Stanley 12.7% for national banks to make and sell loans BNY Mellon 12.4% RBC US 12.4% through fintech partnerships.Page 5 Northern Trust 12.2% MUFG Americas 11.9% Capital One 11.5% State Street 11.4% Columbia Banking System PNC 10.8% buying California for JPMorgan Chase 10.7% 7 9.9% $266 million BMO Financial 9.5% Ciǎgroup 9.4% The deal for Bank of Commerce Holdings U.S. Bancorp 9.1% Regions 8.9% in Sacramento would be the first bank Goldman Sachs 8.8% Wells Fargo 8.8% acquisition in the Golden State for Tacoma, Truist 8.6% HSBC 7.3% Washington-based Columbia. Page 6 0% 5% 10% 15%20% 25% Visa agrees to buy Source: Federal Reserve (based on severely adverse scenario, 1Q2021 - 1Q 2023) 8 open-banking platform Tink for $2 billion Visa Inc. has agreed to buy Swedish open- banking platform Tink AB as the payment higher capital buffers than most of their giant looks to expand beyond its card dailybriefing peers last year. Will their decisions pay off for network. Page 7 shareholders? Page 3 Banks get green light ’s banker 1 to resume payouts after JPMorgan Chase takes 9 was ‘greedy’ for power, acing stress tests 3 long view with U.K. digital prosecutor says The Federal Reserve found that under its consumer bank Stephen Calk, a banker, pushed harshest stress-test scenario, bank capital The nation’s largest bank has no retail through $16 million in sketchy loans to ratios would decline to 10.6% on average — presence outside of the U.S., but that will ’s one-time campaign manager well above the 4.5% minimum requirement. change later this year when it launches an because he “wanted a powerful government Restrictions imposed on dividend payments online-only bank in the United Kingdom. title,” Assistant U.S. Attorney Alexandra and share repurchases during the economic CEO Jamie Dimon has hinted that if the Rothman said in her opening statement in crisis last year will be lifted after June 30. venture proves successful, the Chase brand Calk’s criminal bribery trial. Page 7 (See chart above.) Page 2 could eventually be rolled out in other parts of the world. Page 4 JPMorgan warns employees Why these banks opted in to 10 it may require them to get 2 Fed stress tests when they Acting CFPB Director Dave Uejio vaccinated didn’t have to 4 nominated for HUD post The nation’s largest bank is ordering Four companies — Regions Financial, President Biden has informed the Senate workers to fill out a questionnaire on their MUFG Americas Holdings and the U.S. he wants Uejio, the acting head of the vaccination status by the end of this month, arms of the Royal Bank of Canada, BMO Consumer Financial Protection Bureau, to CEO Jamie Dimon and other members of Financial— felt they had something to prove be an assistant secretary at the Department the operating committee wrote in a memo to to the Federal Reserve after being assigned of Housing and Urban Development. Page 5 staff Wednesday.Page 7 MONDAY JUNE 28, 2021 AMERICANBANKER.COM PAGE 2

required to submit data from their balance weighted assets. FEDERAL RESERVE sheets as of year-end 2020. The Fed tests The Fed did not publish the stress capital those balance sheets against baseline and buffer requirements Thursday, to allow for severely adverse scenarios. banks to make changes to their original Banks get The harshest scenario banks were tested capital distribution plans. But banks will against this cycle was elevated stress in be able to disclose their stress capital green light the commercial real estate and corporate buffer requirements and planned capital debt markets along with an intense global distributions on Monday after the market recession. In that severely adverse scenario, closes, if they choose to do so. to resume banks had to account for a rise in the U.S. The Fed will then release the final unemployment rate by 4 percentage points capital plans before the stress capital buffer payouts after to 10.75%. requirement is set to take effect in the fourth The Fed found that under that scenario, quarter. all of the banks subjected to the stress tests Also on Thursday, the Fed said it had acing stress would collectively suffer $470 billion in corrected an error in both of last year’s stress losses, with almost $160 billion losses from tests that affected the results for BNP Paribas tests commercial real estate and corporate loan USA, and altered the bank’s pre-provision investments. Still, bank capital ratios would net revenue, projected pretax net income By Hannah Lang decline just to 10.6% on average — well above and projected capital ratios accordingly. June 24, 2021 the 4.5% minimum requirement. However, senior Fed officials said that the WASHINGTON—The nation’s largest The central bank also noted that the correction would not affect the bank’s stress banks weathered the worst of the coronavirus stressed capital ratios varied widely across capital buffer. pandemic with plenty of capital, the Federal the 23 banks tested, which reflects the Reserve said Thursday upon release of stress- differences in the composition of each test results that demonstrated for the first firm’s loan portfolios. HSBC North America time how balance sheets were affected by Holdings experienced the lowest capital ratio COVID-19. under the severely adverse scenario at 7.3%, All 23 of the banks tested are cleared after while DB USA — the U.S.-based affiliate of June 30 to resume full dividend payments Deutsche Bank — had the highest, at 23.2%. and share repurchases for the first time in The results of the CCAR stress test are a year. The Fed said each of the firms has used to dictate a firm’s planned capital sufficient capital levels to “continue lending distributions for the year. Banks have to to households and businesses during a severe comply with a so-called stress capital buffer, recession.” which is calculated as the difference between “Over the past year, the Federal Reserve a bank’s starting and projected capital ratios has run three stress tests with several under the “severely adverse” stress-test different hypothetical recessions and all have scenario, and factors in a bank’s common confirmed that the banking system is strongly stock dividends as a percentage of risk- positioned to support the ongoing recovery,” Fed Vice Chair for Supervision Randal Quarles said in a statement. Established 1836 One State Street Plaza, 27th floor, New York, NY 10004 Nineteen of the biggest banks were Phone 212-803-8200 AmericanBanker.com subjected to the annual Dodd-Frank Act Stress Tests and the Comprehensive Capital Editor in Chief Alan Kline 571.403.3846 Copy Editor Neil Cassidy 212.803.8440 Analysis and Review examinations, plus Managing Editor Dean Anason 770.621.9935 four smaller firms that chose to opt in: BMO Reporters/Producers Financial Corp., MUFG Americas Holdings, Executive Editor Bonnie McGeer 212.803.8430 Laura Alix 860.836.5431, Kate Berry 562.434.5432 RBC U.S. Group Holdings and Regions Washington Bureau Chief Joe Adler 571.403.3832 Financial. Executive Editor, Technology Miriam Cross 571.403.3834 Under rules the Fed finalized in 2019, Penny Crosman 212.803.8673 Jim Dobbs 605.310.7780 banks with assets of between $100 billion BankThink Editor Rachel Witkowski 571.403.3857 and $250 billion are only required to undergo John Heltman 571.403.3847, Allissa Kline 716.243.2679 Community Banking Editor Paul Davis 336.852.9496 stress tests every other year. However, those Hannah Lang 571.403.3855 banks can choose to opt in to stress tests in Contributing Editor Daniel Wolfe 212.803.8397 John Reosti 571.403.3864, Gary Siegel 212.803.1560 an “off year” if they wish to make changes to Digital Managing Editor their capital distribution plans. Christopher Wood 212.803.8437 Kevin Wack 626.486.2341 Banks subject to the stress tests are

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“This gives an opportunity for an difference narrowed from a 2.4 percentage CAPITAL independent third party, in this case, the point drop during last year’s test. Federal Reserve, to show everybody what BMO’s ratio fell by 3 percentage points to our losses are relative to peers,” Turner said a bottom of 9.5%, compared with a nearly Why these during the earnings call. “So we’re excited 6 percentage point decline in last year’s about participating. We think it will show results. banks opted well.” MUFG’s ratio fell by 3.4 percentage points The foreign-owned companies,to a low of 11.9%, which is a smaller drop meanwhile, may have opted to prove to the than the 4.4 percentage point decline last in to Fed Fed that they are as safe and sound as any year. domestic bank holding company, Siefers RBC’s CET1 ratio also decreased by 3.4 stress tests said. percentage points to 12.4%, which is slightly “For domestically owned subsidiaries of smaller than the 3.6 percentage point fall foreign banks, there’s been a perception that during last year’s stress test. when they it’s sort of a high hurdle for them,” Siefers The results suggest that the stress capital said. “They’re showing the Fed that they buffers for all four banks could be lowered didn’t have to have infrastructure in place that’s as good as when the Federal Reserve announces later anything else out there.” in the year where the requirements will be By Jon Prior Each bank’s current capital buffer is set. June 24, 2021 based on last year’s stress test. The buffer is BMO appealed its stress test results last This year marked the first time that the difference between a bank’s capital level year after its common equity Tier 1 ratio fell regional banks were allowed to sit out the as the “severely adverse” scenario under the to 5.4% under the severely adverse scenario, Federal Reserve’s annual stress testing stress tests began and where it was projected the lowest among the 33 firms graded at the exercise, and most opted to do just that. to end up, taking into consideration what time. But four companies — Regions Financial the banks planned to pay out in dividends. The company said that it disagreed with in Birmingham, Alabama, MUFG Americas The lower the stress capital buffer, the the Fed’s calculations for noninterest income Holdings in New York and the U.S. arms better the bank is seen to have performed and noninterest expenses and believed of Toronto-based Royal Bank of Canada under the stress test, with the minimum objecting to the grades could lead to a lower and BMO Financial — all opted in, and being 2.5%. The Fed set the extra requirement stress capital buffer requirement. Analysts their decisions could pay off for their for each bank after the stress tests were had wondered if the bank’s restructuring shareholders. completed in June of last year. effort at the time skewed the results. The companies easily passed this year’s Several banks, including Regions and But the Fed dismissed the appeal, leaving tests and, as a result, their stress capital BMO, asked that the tests and their stress the company to opt in to another shot at buffers — that extra layer of cushion the capital buffers be reconsidered. The Fed improving its results this year. Fed required of the largest banks last year dismissed the objections in October and The companies that opted out were Ally during the pandemic — could be lowered, made the buffers official through September Financial, Citizens Financial Group, Fifth freeing them to return more of the capital 2021. Third Bancorp, Huntington Bancshares, to shareholders in the form of dividends or Regions was assigned a 3% stress capital KeyCorp, M&T Bank Corp., the credit card stock buybacks. buffer. The Fed required a 6% buffer for giants American Express and Discover “One of the motives” for opting in to the BMO, 4.4% for MUFG and 3.6% for RBC. Financial and the U.S. units of BNP Paribas stress tests “is to improve the stress capital Each was higher than most of their peers. and Santander Holdings USA. buffer,” said Scott Siefers, managing director The Fed’s stress test covers the period Each of the banks that opted out declined and senior research analyst at Piper Sandler. ending in the first quarter of 2023. It in part to say why. For some, there may have been Banks with assets between $100 billion measures how much a bank’s common little incentive because their capital buffers and $250 billion are now stress tested every equity Tier 1 ratio deteriorates under a are already low or have no intentions to other year and this year marked the first severe downturn. This plays a key role in how pay out dividends or buy back stock. For time banks not scheduled to be tested could the Fed calculates what higher stress capital instance, M&T has said it did not plan to voluntarily opt in. buffers the banks are required to hold. repurchase shares again until its $7.6 billion Regions, BMO Financial, RBC and MUFG A smaller deterioration in the CET1 ratio acquisition of People’s United is completed, declined to comment before the results were in this year’s stress test compared to last which might not be until the fourth quarter. released. But David Turner, chief financial year’s is a key indicator of how much in “Unless you have a company specific officer of the $153.3 billion-asset Regions, losses a bank can absorb and whether it will factor, it’s unclear to me exactly what the said on an April 23 earnings call that the have its stress capital buffers lowered. upside is to doing so,” Siefers said. “If company was opting in because executives Regions’ CET1 ratio fell by about 1 you’re already at a low capital buffer, you’re were confident the upcoming results would percentage point from 9.8% to a minimum probably having unofficial conversations bear out proof that the bank can handle a of 8.9% under the severe adverse scenario, with the Fed anyway. No need to open up a lower stress capital buffer. according to Thursday’s results. That box that could have some negative surprise.”

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of additional users, and the more customers they think they can achieve greater scale. CONSUMER BANKING it has using digital services, the more money HSBC, which has pivoted its focus to wealth it can make without meaningfully increasing management, has found buyers for its mass- expenses, analysts said. market retail franchises in both the U.S. and JPMorgan Other factors make the timing good for France. Earlier this month, Banco Bilbao JPMorgan Chase to test the waters. The Vizcaya Argentaria in Spain completed the Chase takes pandemic has made consumers more sale of its U.S. franchise, BBVA USA, to PNC comfortable using digital banking channels Financial Services Group in Pittsburgh. And and with interest rates expected to stay low is selling consumer franchises in long view with for at least another couple of years, customer China, India and 11 other countries to focus acquisition — through mergers or expansion on higher-returning businesses such as U.K. digital — is crucial for driving profitability, observers wealth management and treasury and trade said. services for multinational corporations while “The thinking is, ‘If we can start generating strengthening its retail operations in the U.S. consumer revenues in the U.K. without a huge branch Despite retreating in some areas, all three network, let’s give it a try,’” Piper Sandler still have massive international operations. bank analyst Jeffery Harte said. “If it doesn’t work, HSBC provides retail banking in 33 markets, they might lose a little bit of money on it, but BBVA has substantial presence in Europe and By Allissa Kline I’m not sure it would be noticed in the financial Latin America and Citi operates business lines June 24, 2021 results. The pandemic pulled digital adoption in nearly 100 markets across the globe. JPMorgan Chase is a big global bank, but ahead by years — so much further ahead, it’s The difference in strategy comes down unlike some of its rivals, has no retail presence more reasonable to think you can do this now.” to the fact that JPMorgan Chase already in markets outside of the U.S. That will change At JPMorgan, active mobile customers has reached a level of scale in the U.S. that later this year with the launch of a digital increased by 9% year over year to 42 million makes it easier, and less risky, to seek growth consumer bank in the United Kingdom. people, while branch transactions were down internationally, some say. Buoyed by its vast digital capabilities and by double digits. “I think it’s an opportunity to complete the limited by how much it can grow in the U.S. Other banks are seeing similar trends. continuum and see if they can replicate some due to federal caps on market share, the largest According to a survey from S&P Global Market of the success they’ve had in the U.S. market by bank in the nation is looking across the pond Intelligence, nearly 52% of consumers say they cross-selling products across that continuum,” to expand its consumer banking business. are visiting branches less frequently since the analyst Susan Roth Katzke of Credit Suisse If the venture is successful, the Chase retail pandemic began and, of those respondents, said. “And cross-selling is not a dirty word. It’s brand could eventually be rolled out in other more than 65% said they are using mobile the way to make money.” parts of the world. apps more often. In a recent Credit Suisse report, Roth Katzke The New York-based company, which “I don’t think you’re going to put the genie and other analysts say that scale in the banking has been doing commercial and investment back in the bottle,” Fitch Ratings analyst industry is realized when two things happen: a banking in the U.K. for years, took the first Christopher Wolfe said. bank “has pricing power and above-average step toward building a digital bank there last JPMorgan Chase seems to be tapping into profitability supported by low and declining week, when it announced a deal to acquire that growing preference for mobile banking, unit operating costs and” and when it has the London-based digital wealth manager Harte said. “outside capacity and willingness to invest in Nutmeg. “I think for JPMorgan, it’s more of ‘Can technology and spend in support of marketing “Think of it as a long-term play,” Chair and we take this retail bank presence of ours and and branding.” CEO Jamie Dimon said last week at an industry generate profits internationally by going Achieving scale matters when it comes to conference, referring to the company’s digital?’” Harte said. “Which you couldn’t do sustainable returns and share prices, they said. decision to offer retail banking services in the two or three years ago because digital banking “To be sure, we are not suggesting that bigger U.K. “If it works, then we’ll think about other wasn’t as widely adopted. It’s a much more is better,” the analysts wrote. “We do conclude things we could do with that.” viable option now than it was before.” that the realization of scale economies … JPMorgan Chase has historically focused JPMorgan Chase is not the first big bank to factors heavily into banks’ sustainable growth its retail efforts solely within the United States, offer a digital consumer bank in the U.K. — and return prospects.” where it continues to expand its reach. It is in Goldman Sachs’ retail banking arm, Marcus, For JPMorgan Chase, moving retail into the the midst of a years-long strategy to add 400 has been offering online savings accounts U.K. is a way “to leverage a lot of what they’ve branches in 20 markets and by mid-July, it there since 2018. learned from their digital capabilities in the expects to have at least one branch in each of JPMorgan Chase declined to comment on U.S. and attempt to grow in another part of the the lower 48 states. its U.K. strategy, but it’s decision to launch a world,” Fitch Ratings analyst Bain Rumohr said. The shift overseas, meanwhile, presents digital consumer bank in that market comes “What they’ve built is certainly compelling minimal risk with potentially big rewards, at a time when other big banks are retreating and formidable,” Rumohr said. “If they are analysts say. The company has the necessary from certain international regions in order to able to replicate that in the U.K., it would be an technology platforms to accommodate scores double-down in markets and segments where impressive feat.”

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bureau issued an interim final rule in April president can only fire the director for cause. BIDEN ADMINISTRATION supporting the Centers for Disease Control The ruling effectively gives the president the and Prevention’s eviction moratorium and is authority to fire the director at will. set to release new servicing rules that would Biden exercised his newfound power Acting CFPB provide homeowners more options to avoid Wednesday afternoon, removing Calabria foreclosure. as FHFA director. In an internal email sent Director to staff sent shortly after 2 p.m., the Trump- appointed Calabria said that his two two BIDEN ADMINISTRATION years as director were “an honor of a lifetime.” Dave Uejio As FHFA director, Calabria worked to set Fannie Mae and Freddie Mac on a path out nominated for Biden of conservatorship and into private hands, at one point predicting that the government- appoints sponsored enterprises would be fully HUD post privatized by 2024. But many of those efforts — including a By Kate Berry Sandra post-conservatorship capital framework and June 24, 2021 last-minute changes to the government’s President Biden has nominated Dave Thompson oversight of the companies made with former Uejio, the acting director of the Consumer Treasury Secretary Steven Mnuchin — came Financial Protection Bureau, to be an under fire from lenders and affordable assistant secretary at the Department of acting FHFA housing advocates alike. Housing and Urban Development. They had argued that many of the actions Uejio remains the CFPB’s acting director director the agency took under his leadership would until Rohit Chopra, the president’s nominee make homeownership less affordable, to lead the bureau, is confirmed by the Senate. By Hannah Lang particularly for lower-income and minority Uejio, who would become assistant secretary June 23, 2021 borrowers, in direct conflict with the Biden for fair housing and equal opportunity if WASHINGTON—President Joe Biden administration’s goals of expanding housing confirmed by the Senate, was on a list of named Sandra Thompson as acting director opportunities. White House nominees sent to the chamber of the Federal Housing Finance Agency late on Thursday. Wednesday, hours after removing Mark That Uejio was nominated to HUD Calabria as head of the agency in the wake of CONGRESSIONAL REVIEW could be an indication that Chopra will be a Supreme Court ruling that said the FHFA’s ACT confirmed soon by the Senate. Chopra sits leadership structure was unconstitutional. on the Federal Trade Commission, and some Thompson, who was most recently the analysts have attributed the delay in his deputy director of the FHFA’s Division of House follows confirmation to work that still needs to be Housing and Mission Goals, has been at the done at the FTC under newly confirmed FTC agency since 2013. Before joining FHFA, she Senate in Chairwoman Lina Khan. worked for 23 years at the Federal Deposit “The Senate confirmation process can take Insurance Corp., ultimately serving as the time,” Uejio said in a memo to CFPB staff. “I director of risk management supervision. rejecting intend to continue to serve as acting director In a statement, Thompson said she is as I navigate that process. I expect that we “committed to making sure our nation’s OCC’s ‘true will have a permanent director in place well housing finance systems and our regulated before my own confirmation, and I will keep entities operate in a safe and sound manner.” working towards a smooth transition.” “We can accomplish this, and at the same lender’ rule Uejio, the former chief strategy officer of the time have a laser focus on mission and CFPB and a nine-year veteran of the agency, community investment,” she said. “There is By Brendan Pedersen has adhered closely to the goals of the Biden a widespread lack of affordable housing and June 24, 2021 administration. He has been a busy acting access to credit, especially in communities of WASHINGTON — The House voted on director, moving quickly to rescind Trump- color. It is FHFA’s duty through our regulated Thursday to dismantle a Trump-era rule era rules. He also has announced a number entities to ensure that all Americans have that sought to make it easier for national of initiatives to address racial inequality and equal access to safe, decent, and affordable banks to make and sell loans through fintech aid consumers during the pandemic. housing.” partnerships. The CFPB has been working closely with The Supreme Court issued an opinion Following the Senate’s lead from early May, the White House to aid both homeowners early Wednesday striking down a provision in the House voted 218-208 to rescind an Office and renters during the pandemic. The the 2008 law establishing the FHFA that said a of the Comptroller of the Currency regulation

For up to date and complete coverage go to AmericanBanker.com MONDAY JUNE 28, 2021 AMERICANBANKER.COM PAGE 6 known as the “true lender” rule using the of national banks and partnerships under the Wednesday that it would pay about $266 Congressional Review Act. The measure now guise of quote-unquote consumer protection,” million in stock for Bank of Commerce, the goes to President Biden’s desk, and he is McHenry said during the floor debate. $1.8 billion-asset parent of Merchant Bank of expected to sign it into law. Republican representatives arguing against Commerce. The deal is expected to close in the As in the Senate, the Congressional Review the CRA challenge frequently invoked the fourth quarter. Act vote to overturn the OCC’s rule was need to maintain access to credit among The combined company would have more bipartisan, albeit barely: One Republican communities of color, saying that fintech firms than 150 branches in Washington, Oregon, House member voted with Democrats to undo were more likely to serve such populations. Idaho and California. the regulation. “Fintech has been instrumental in “Northern California shares many The rule, finalized in October by former expanding access to credit for consumers similarities with the Northwest in both acting Comptroller Brian Brooks and in effect who have little or no credit history,” said Rep. metropolitan and rural markets, making since December, introduced a simple test to Barry Loudermilk, R-Ga. “This resolution expansion into this region a natural extension determine who the “true lender” is in bank- is devastating to minority consumers and of our existing footprint. We appreciate nonbank partnerships; if a bank funds the loan businesses, and those with subprime credit, how the management team has grown this or is named as the lender in an agreement, and the unbanked. Instead of giving those franchise in a profitable manner and are under the rule, the bank would be considered people options, this resolution would direct excited to have them join Columbia to help the true lender. them to payday lenders or, in states like manage our California expansion,” Clint Stein, When a national bank is considered the Georgia where payday lending is illegal, they Columbia’s president and CEO, said in a press true lender, the loan qualifies for federal will have no access to credit.” release. protections such as preemption from state Some Democrats greeted such concerns Coumbia has been active acquirer over the interest rate caps. While many in the banking with skepticism. past two decades but had not bought a bank industry supported the rule and praised its “I am absolutely overcome by the great since late 2017, when it purchased Pacific simplicity, consumer protection advocates interest that my Republican colleagues have Continental Bank in Eugene, Oregon. Stein have argued the test would make it too easy for in helping minorities,” House Financial had hinted about his company’s interest in predatory lenders to export expensive loans Services Committee Chair Maxine Waters, the northern California market in an interview into states with strict usury laws using national D-Calif., said during the floor debate. “But I with American Banker late in 2019. bank powers. hardly think that this is all about taking care of The 11 California locations will continue “This ‘fake lender’ rule greenlights rent- minorities and these small businesses. This is operations under the Merchants Bank of a-bank schemes in which predatory lenders about protecting the big banks. This is about Commerce brand as a division of Columbia evade bank interest rate limits to swindle protecting the national banks.” Bank after the deal closes. Bank of Commerce vulnerable consumers,” said House Speaker CEO Randy Eslick will lead that division and Nancy Pelosi, D-Calif., during a floor debate hold the title of president. prior to the vote. “This is done by putting a M&A “We look forward to continuing to honor bank name on loan paperwork and claiming those values while offering clients an expansive that the bank, not the predatory lender, issued array of additional products and solutions as the loan.” Columbia part of the Columbia family. Additionally, I In a statement issued in response to the vote, am very pleased to continue to lead the same acting Comptroller of the Currency Michael Banking teams of exceptional bankers serving our Hsu said in the OCC “will consider policy clients in each of our markets following the options, consistent with the Congressional close of the merger, ensuring clients continue Review Act, that protect consumers while System buying to enjoy access to the same local expertise and expanding financial inclusion.” relationships,” Eslick said in the press release. “Both of these priorities are part of the California Columbia said the deal will be 3% accretive agency’s mission of ensuring that national to its earnings per share in 2022, 4% in 2023 banks and federal savings associations and 0.3% accretive to tangible book value per provide fair access to financial services for bank for $266 share. all Americans and that customers are treated “Financially, the acquisition appears solid,” fairly,” Hsu said. million Stephens analyst Andrew Terrell said in a June Republicans, led by Rep. Patrick McHenry 24 note to clients. of North Carolina, the ranking member of the By Ken McCarthy Piper Sandler analyst Matthew Clark agreed, House Financial Services Committee, argued June 24, 2021 saying that Columbia is taking “a logical route” ahead of the vote that throwing out the OCC’s Columbia Banking System in Tacoma, to expansion “at a very reasonable price,” he rule would sow confusion and limit consumer Washington, has agreed to buy Bank of wrote. access to credit. Commerce Holdings in Sacramento in a Keefe, Bruyette & Woods and Sullivan & “Let’s call this what it is: It’s blue states, and deal that will mark Columbia’s entry into the Cromwell LLP advised Columbia on the deal. their left wing, so-called consumer protection Golden State. Bank of Commerce was advised by Raymond advocates, who want to again limit the reach The $17.3 billion-asset Columbia said late James & Associates and Miller Nash LLP.

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of fintech at Dawn Capital, which led a $100 And he said a salesman who brokered the loan M&A million investment round in Tink in 2019. cast Manafort in a positive light, hoping for a Visa’s transaction is subject to regulatory commission on the deal. approvals and other customary closing “This is not a sweetheart deal,” Schoeman Visa agrees conditions. Earlier this year, Visa scrapped its said. “He loved these loans. He thought they proposed $5.3 billion acquisition of Plaid Inc. in were good for his bank based on what he was to buy open- the face of a prolonged antitrust fight with the told and what he knew.” U.S. Justice Department. Schoeman told jurors that Trump’s name will come up frequently during the trial. banking “Some people like him, some people don’t,” CRIME AND MISCONDUCT he said. “Don’t let that influence you in this case.” platform Tink The first witness against Calk was Blake Paulson, a top official at the Office of the Paul Manafort’s Comptroller of the Currency, who testified about for $2 billion conflict of interest rules for bankers. He also told banker was jurors of a meeting he had with Calk and others By from Federal Savings Bank in July 2018, in the June 24, 2021 wake of media reports claiming the banker had Visa Inc. has agreed to buy Swedish open- ‘greedy’ made loans to Manafort in hopes of getting a banking platform Tink AB as the payment giant high-level government job. looks to expand beyond its card network. for power, “He strongly denied wanting a position in the San Francisco-based Visa said it will pay government” in the meeting, Paulson said. a total of 1.8 billion euros ($2.15 billion) Among the witnesses set to testify against -- including cash and retention incentives prosecutor says Calk are Anthony Scaramucci, the Skybridge -- to acquire the fintech firm, according to a Capital founder who spent 11 days as White statement Thursday. By Bloomberg News House communications director, before being Banks and startups use Tink to access June 24, 2021 fired after making a profanity-laced phone call consumer financial data. The startup was A Chicago banker charged with pushing trashing others in the White House to a reporter founded in Stockholm in 2012 and it has about through $16 million in sketchy loans to Donald for The New Yorker. Scaramucci is expected to 400 employees, with technology that connects Trump’s former campaign chief Paul Manafort testify about Manafort’s efforts to promote Calk. to more than 3,400 banks that reach over 250 did it because he was greedy for prestige and The case is U.S. v. Calk, 19-cr-00366, U.S. million bank customers across Europe. power, not for money, a prosecutor told jurors at District Court, Southern District of New York “This acquisition is a sign of our commitment the start of a criminal bribery trial in Manhattan. (Manhattan). to Europe,” Charlotte Hogg, chief executive Stephen Calk “wanted a powerful government officer of Visa Europe, said in the statement. title and gave out millions of dollars in bank “In Tink, we have found a strong partner with loans to try and get it,” Assistant U.S. Attorney WORKFORCE MANAGEMENT whom we can accelerate innovation in open Alexandra Rothman said in her opening banking.” statement. Open banking services have grown in Europe The government claims Calk used the loans to JPMorgan since a European Union law mandated that Manafort as a bribe for help in landing a spot as an third party payment companies could access adviser on Trump’s presidential campaign and, warns bank information to improve competition. Tink later, for a top job in the Trump administration. is one of more than 440 such providers across Calk told Manafort he would be interested in Europe. one of a number of senior government jobs, employees it Visa said it will fund the transaction from including Secretary of the Treasury, Commerce cash on hand and the transaction will have or Defense. He also said he’d be interested in an may require no impact on its previously-announced stock ambassadorship to one of 19 countries, led by buyback program or dividend policy. the U.K. and France. The deal comes with fintech startups Calk, the founder and longtime chief them to get in Europe attracting multibillion-dollar executive of Federal Savings Bank, failed to win valuations from investors and potential stock a post in the Trump administration. He did get vaccinated market listings. Digital-payments provider Wise an interview, at Trump Tower, for the job of confirmed its plans to go public on the London undersecretary of the Army with Manafort’s By Bloomberg News Stock Exchange on Thursday. backing, but wasn’t selected. June 24, 2021 “This is a fantastic outcome for Tink, Calk’s lawyer, Paul Schoeman, blamed JPMorgan Chase said it may require European fintech and the future of open Manafort for lying to the bank about his finances, employees to be vaccinated against the banking,” said Mina Mutafchieva, co-head to make it more likely he would get the money. COVID-19 virus, as Wall Street’s biggest

For up to date and complete coverage go to AmericanBanker.com MONDAY JUNE 28, 2021 AMERICANBANKER.COM PAGE 8 banks ramp up efforts to keep thousands and Standard Chartered confirmed their of personnel safe while reopening U.S. participation in a cooperatve that will prepare HOUSING workplaces. the technology for a November 2022 launch. The nation’s largest bank is ordering “Swift’s platform strategy helps provide workers to fill out a questionnaire on their the industry with a clear path towards a Biden to put vaccination status by the end of this month, ubiquitous instant and frictionless cross- Chief Executive Jamie Dimon and other border payments experience, which, coupled $46 billion members of the operating committee wrote with Swift’s established global reach and in a memo to staff Wednesday. Employees scale, represents a credible path to success,” who don’t respond will be contacted by Manish Kohli, head of payments and into effort to managers until they do. receivables, treasury and trade solutions at “We need you to enter this information Citi, said in a press release Thursday. avoid flood of so that we can properly prepare for and The network’s new features include manage returning to the office,” the upfront validation of beneficiary details, executives said in the memo. “In the future, central management of exceptions, extension evictions we may mandate that all employees receive of Swift’s high-speed Global Payments a COVID-19 vaccination consistent with Innovation rails to lower-value payments By Bloomberg News legal requirements and medical or religious and new rich data services based on the ISO June 24, 2021 accommodations.” 20022 standard. The White House is working with state and For now, the executives said, all U.S. “Swift’s platform will be a powerful catalyst local governments to distribute $46 billion employees — including those who aren’t for innovation for the financial services in rental assistance and other programs vaccinated — should plan to start regular industry,” Ole Matthiessen, managing over the next 30 days, aiming to prevent a office schedules July 6, though some may director, global head of cash management at flood of evictions when the federal eviction have to work remotely part of the time due to Deutsche Bank, said in the release. “We can moratorium ends on July 31, administration occupancy limits. already see how the platform will allow our officials said. Morgan Stanley advised workers this week industry to seamlessly integrate new features Following on a one-month extension of that they will be barred from offices in the that will reduce costs and provide for faster, the pandemic-related moratorium for renters New York area if they aren’t vaccinated. It is frictionless payments.” announced by the Centers for Disease Control among big financial firms taking a harder line Swift says the platform evolution is a and Prevention Thursday morning, President against employees who haven’t yet returned. continuation of the work it has done over Biden’s administration also extended the the past five years to transform cross-border moratorium on foreclosures on federally payments. Through GPI, most cross-border backed mortgages through the end of July. CROSS BORDER PAYMENTS payments today reach their destinations But the latest moratorium extension within minutes, with full transparency and is intended to be the last. Administration confirmation. officials said the additional time will be Global banks The new platform ensures interoperability used to set up a national system for the aid with new payment types, technologies and distribution, which is coordinated through to test services, while setting up banks to accept state and local governments. future innovations in payments and securities The administration officials said in a processing. briefing that the federal funding can be used new Swift The Swift network connects more than for direct rental assistance and for programs 11,000 institutions and 4 billion accounts aimed at preventing evictions by facilitating payments across 200 countries worldwide. agreements between landlords and tenants. The Department of Justice is working with state courts to encourage such policies, and platform multiple bar associations have partnered with the White House and city officials across By David Heun the country to connect families to counsel June 24, 2021 and direct them to resources, the officials Six major global banks have committed said. to preparations for and testing of Swift’s new Funding will come from programs transaction management platform, a process designated to help stem evictions that were designed to enable new services, improve included pandemic relief legislation. q efficiency and reduce costs for international payments. © 2021 Arizent and American Banker. Bank of China, Bank of New York Mellon, All rights reserved. BNP Paribas, Citigroup, Deutsche Bank

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