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Old School Large U.S THURSDAY APRIL 1, 2021 VOL. 186 No. 62 AMERICANBANKER.COM Follow us on Twitter @AmerBanker Where Goldman, Citi, 5 JPMorgan are putting fintech investment dollars Old school Large U.S. banks are directing their venture While larger banks have diversified their revenue streams over capital dollars to fintechs in capital the years, community banks still largely rely on loans to make markets, wealth management and “future- money proofing.” Page 5 See story on page 4 Two bankers banned 6 from industry in closely Net interest income, 70.9% watched trade secret case In an enforcement action that could have Net gains from loan sales, 8.9% reverberations across the sector, the Fed imposed tough penalties on a pair of Fiduciary acǎviǎes, 4.3% Wyoming bankers who took confidential Service charges, 3.0% information to their new employer. Page 7 Investment banking, 0.6% Debit’s on a roll. Are small 7 merchants getting rocked? Insurance income, 0.5% The Justice Department’s probe of Visa Trading account gains, 0.1% highlights whether merchants are properly equipped to adapt to the cost of debit spending Other noninterest income, 11.7% as more commerce goes digital. Page 8 Visa, Mastercard face Source: FDIC (2020 data for banks with below $10B of assets) 8 new pushback in $5.5 billion retailer suit Visa and Mastercard are facing fresh opposition from U.S. retailers in a long- dailybriefing Fee income lagging, running legal fight over the fees merchants 3 Louisiana bank makes pay each time consumers swipe their credit bet on wealth management or debit card at checkout. Page 9 Will Senate vote on CFPB chief Business First Bancshares is counting on its 1 come down to tiebreaker? acquisition of Smith Shellnut Wilson to help Walgreens eyes Wall Street’s The full Senate could deadlock on Rohit it offer more advisory services to commercial 9 turf with new bank Chopra’s nomination as the Banking clients. (See chart above.) Page 4 account offering Committee did. If that happens, Vice The drugstore chain will debut a new bank President Kamala Harris is expected to cast BofA expands racial account for customers that will offer rewards the decisive vote in his favor. Page 2 4 equity pledge with tied to its loyalty program. Page 9 focus on Asian Americans How racial justice Bank of America said Tuesday that it would Wells Fargo unwinds 2 push sparked new up its initial commitment from $1 billion to 10 Archegos exposure CRA law in Illinois $1.25 billion and would increase support without posting losses The banking and credit union industries in Asian American communities, where Shares of the company advanced after it opposed the Illinois Community violence and incidents of harassment issued a statement about the bank’s prime- Reinvestment Act, but they were largely have risen sharply during the COVID-19 brokerage relationship with the family shut out of a process that moved quickly pandemic. Page 5 office. Page 9 amid a nationwide reckoning on racial inequality. Page 3 THURSDAY APRIL 1, 2021 AMERICANBANKER.COM PAGE 2 an FTC commissioner. Toomey said Chopra was “one of the CFPB The tight path he faces to leading the right-hand men” for the CFPB’s first director, CFPB has more to do with the agency’s Richard Cordray, who led the agency from partisan history than with Chopra himself. 2012 to 2017. The GOP senator argued that Will Senate As the brainchild of Sen. Elizabeth Warren, Chopra would “restore this regulator to a very D-Mass., the CFPB has been lauded by harsh anti-business, anti-banking entity.” vote on CFPB Democrats for the billions of dollars it But Toomey acknowledged that has returned to harmed consumers. But Republicans would not be able to muster Republicans have been opposed to the enough opposition to defeat the nomination. chief come agency since its conception, arguing it has “Even if no Republicans supported his been unaccountable and overly aggressive confirmation — and there might well be down to in its enforcement actions against financial some support, it won’t be many — he’ll firms. probably be confirmed,” he said at the ABA “We expected it would be close,” said Ed conference. tiebreaker? Mierzwinski, senior director of the federal Some observers say it is possible that consumer program at the U.S. Public Interest Republicans like Sens. Susan Collins of By Neil Haggerty Research Group. “The Republicans have Maine, Lisa Murkowski of Alaska and Mitt March 30, 2021 decided that they’re going to stand with Romney of Utah, could still support Chopra’s WASHINGTON — The tie vote in the Wall Street on this issue. And, quite frankly, nomination once the full Senate takes it up. Senate Banking Committee earlier this they’re going to stand with payday lenders “It is definitely possible, whether that’s month on Rohit Chopra’s nomination as and Wall Street on this issue.” Murkowski or Collins or Romney, it’s Consumer Financial Protection Bureau A financial services lobbyist added possible,” the financial services lobbyist director made clear the GOP will oppose that most Republicans likely won’t vote said. “Those folks have voted for probably progressive picks to lead the regulatory to confirm any person nominated by a more Biden nominees than any others in the agencies. But observers say that opposition Democratic president to lead the CFPB. Republican caucus. If they choose one or two may just be a speed bump on the way to “Even though he’s a progressive, he to vote ‘no’ on, just to kind of maintain their Chopra’s leading the bureau. demonstrated he’s more than capable and Republican street cred a little bit, maybe this The committee was deadlocked after more than qualified,” the financial services is an easy one to vote ‘no’ on because it’s the all of the panel’s 12 Democrats voted to lobbyist said. “So the reality is, [Republicans] CFPB. But I do think it’s a real possibility that support the Chopra and all 12 Republicans are just going to vote ‘no’ on anybody. It Chopra could get one or two Republican voted against him. The parties have equal could have been Gandhi and they would [votes] on the floor.” representation on Senate committees. But have voted ‘no.’ “ Ed Mills, a policy analyst with Raymond since Vice President Kamala Harris can Ian Katz, a director at Capital Alpha James, said Collins has previously focused break any tie in the Senate, Senate Majority Partners, agreed that “a lot of Republicans on nominees’ “qualifications” when Leader Chuck Schumer, D-N.Y., can offer a either don’t think the CFPB is necessary or determining her support or opposition. motion to release Chopra’s nomination from are skeptical of what it does.” “Her history and her rationale for the Banking Committee, advancing him to a “And certainly they don’t like the way the supporting individuals nominated by both floor vote. Democrats approach it,” Katz said. Democrats and Republicans has been that While the additional procedural hurdle could delay Chopra’s nomination, industry observers say the Federal Trade Commission Established 1836 One State Street Plaza, 27th floor, New York, NY 10004 member and former CFPB student loan Phone 212-803-8200 AmericanBanker.com ombudsman’s bid to head the consumer watchdog is likely to prevail — though Harris Editor in Chief Alan Kline 571.403.3846 Copy Editor Neil Cassidy 212.803.8440 may need to cast the decisive vote. Managing Editor Dean Anason 770.621.9935 “He’s very likely to be confirmed since Reporters/Producers confirmation now can occur on a simple Executive Editor Bonnie McGeer 212.803.8430 Laura Alix 860.836.5431, Kate Berry 562.434.5432 majority, with the vice president breaking Washington Bureau Chief Joe Adler 571.403.3832 a tie,” Sen. Pat Toomey of Pennsylvania, Executive Editor, Technology Miriam Cross 571.403.3834 the top Republican on the Senate Banking Penny Crosman 212.803.8673 Jim Dobbs 605.310.7780 Committee, said at a recent virtual BankThink Editor Rachel Witkowski 571.403.3857 conference hosted by the American Bankers John Heltman 571.403.3847, Allissa Kline 716.243.2679 Community Banking Editor Paul Davis 336.852.9496 Association. Hannah Lang 571.403.3855 While Chopra is viewed as a progressive, his Contributing Editor Daniel Wolfe 212.803.8397 John Reosti 571.403.3864, Gary Siegel 212.803.1560 nomination isn’t particularly controversial Digital Managing Editor given his prior experience at the CFPB and Christopher Wood 212.803.8437 Kevin Wack 626.486.2341 his previous Senate confirmation to serve as For up to date and complete coverage go to AmericanBanker.com THURSDAY APRIL 1, 2021 AMERICANBANKER.COM PAGE 3 the advice and consent of the Senate is year, reducing the clout of the financial about, is this person qualified?” Mills said. UNDERSERVED services industry in certain policy areas. “And when she has been a ‘no’ vote, she POPULATIONS “Our nation’s systems were designed to believes it comes down to the qualifications. keep Black people from owning businesses, We would have to see her outline a rationale buying homes and fostering economically as to why Chopra is not qualified for her to How racial prosperous communities,” Senate Majority justify her ‘no’ vote.” Leader Kimberly Lightford, a Democrat who Still, Democrats pushing Chopra’s justice push is the first Black woman to serve in that role, nomination don’t want to lose any members said last week in a press release. “To achieve of their party when the full Senate votes. If all real equity in Illinois, we must dismantle Republicans oppose Chopra’s nomination, sparked new these systems and rebuild them in a way Chopra needs the support of the full that gives African Americans the chance to Democratic caucus and then a tie-breaking CRA law in succeed.” vote from Harris.
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