| August 27, 2012
Sign up for free:
 | | This week's sponsor is Progress Software. |  | Webinar: Controls for automated trading. Can you rely on the sell-side alone?
Wednesday, August 29th, 11 am ET / 8 am PT Join us for this informative and thought-provoking webinar, lead by renowned Capital Markets expert Richard Bentley, VP of Capital Markets, Progress Software . And learn how you can better mitigate and manage the risk of automated trading. Register today! |
Today's Top Stories
1. Lots of jockeying JPMorgan's legal risks rise
2. Facebook's incendiary admission about IPO motives
3. Dispute over Bank of America's future
4. UBS reiterates opposition to Nasdaq Facebook offer
5. Columnist offers tepid support for Bank of America Editor's Corner: Bank of America adds four more directors Also Noted: Spotlight On... Citigroup's celebrity hire
Citigroup private bank redeems from Paulson; Drama at Wells Fargo and much more... News From the Fierce Network:
1. Low latency race heats up
2. Is Square the first mobile payments "winner"?
3. Determining the value in social media
| 
Bank of America adds four more directors
Bank of America has appointed four new independent directors to its boards, in anticipation most likely that some current directors will step down before the 2013 proxy season.
The new directors are Sharon Allen, former Deloitte chairman; Jack Bovender, former HCA chairman and chief executive; Linda Hudson, president and CEO of the U.S. subsidiary of defense contractor BAE Systems; and David Yost, former CEO of pharmaceuticals company AmerisourceBergen. The board now has 16 members, though that will decline as people step off within a year. "Bank of America shareholders will benefit from the global perspectives, diverse insights and depth of experience these leaders possess," said Bank of America Chairman Charles O. Holliday, Jr. in a statement. "They have a range of expertise in leading large, complex organizations, some in highly regulated industries with global businesses, that will enhance the board of directors." I will assume that they are suitably independent, though their relationship with CEO Brian Moynihan should be checked. The one thing that stands out, however, is that none of them have financial services industry experience. Some academics have suggested, in order to explain the weak link between board independence and performance, that independence is not enough. One study has found a positive correlation between performance and independent directors with industry experience but no correlation between performance and independent directors with no industry experiences. While none of the new candidates have industry experience, several existing director do. Charles Rossotti, however, is nearing the 72 year mandatory retirement age. The other independent with industry experience, Robert Sculley, is only 62. Still, with the new additions, the percentage of directors with direct experience running a major financial company is even smaller. It will be interesting to see who steps off the board next year. -Jim Read more about: Bank of America, corporate governance
back to top
|
| Sponsor: Kaseya FierceLive! Webinars > Controls for automated trading. Can you rely on the sell-side alone? Wednesday, August 29th, 11 am ET / 8 am PT
> Webinar: Network Security: Emerging threats require updated Best Practices- September 12, 2pm ET/ 11am PT
Events > Investment Consultants Forum - The Crowne Plaza Times Square, New York, NY - March 2, 2012
> NFC Ticketing Europe 2012 - March 20-21 - London
> NYIF Essentials of Project and Infrastructure Finance - September 10-12 - New York, NY
> Investment Trends Summit - September 12-14, 2012 - The Four Seasons, The Biltmore - Santa Barbara, CA
> Investment Trends Summit - September 12-14, 2012 - Santa Barbara, CA
> NYIF Wealth Management Program - October 29- November 16 - St. Petersburg/Tampa FL
> NFC Payments USA Unites NFC Experts in Boston Once Again - October 29-30 - Boston, MA
> The Mobile Wallet Summit - November 28-29 - London
Marketplace > Get Subscriptions to the Leading Finance Magazines for FREE
> Whitepaper: Using Modern CRM to Attract and Retain Advisors and Clients
> Whitepaper: Ten Effective Habits of Indispensable IT Departments
* Post a classified ad: Click here.
* General ad info: Click here | Today's Top News 1. Lots of jockeying JPMorgan's legal risks rise So just how high will the legal costs be for JPMorgan to resolve the Whale Trade fiasco? The question will be determined in part by the private litigation that has been filed against the company. A judge has certified a class action against the bank, and the lead plaintiffs appear to be six public pensions, the Arkansas Teacher Retirement System, State Teachers Retirement System of Ohio, School Employees Retirement System of Ohio, Ohio Public Employees Retirement System, Oregon Public Employee Retirement Fund and Swedish pension fund Sjunde AP-Fonden. Other pensions will no doubt join the class over the near-term. The jockeying for position by plaintiffs and law firms has been fairly intense, as different approaches have been floated. It will be a long time for all this to be resolved. In the end, it might not amount to much. The bank will surely reserve against it, and hopefully it will prove inconsequential. But as of now the risks have to be seen as open-ended, as the number of investigative bodies taking an interest has soared. Bloomberg notes that the bank is being investigated by at least 11 agencies, state, federal and international. Singapore, Germany and Japan were the latest to jump on the bandwagon. Fortunately, the bank has become accustomed to a high level of regulatory scrutiny. This is good news for the lawyers. For more:
- here's the article
- here's the Bloomberg article Related articles:
As Dimon's luster fades, who will rise?
JPMorgan increases share buyback delays Read more about: JPMorgan, Litigation
back to top
| This week's sponsor is Kaseya. |  | Ten Effective Habits of Indispensable IT Departments
It's no secret that responsibilities are growing while budgets continue to shrink. Enact these ten IT habits throughout your financial institution to help you cut costs, create operational efficiencies and align IT to business goals. Download Today!
|
2. Facebook's incendiary admission about IPO motives Was Facebook trying to "screw" Wall Street? I acknowledge this is a rather incendiary question, but this is what the esteemed FOX Business correspondent Charles Gasparino has reported: Facebook CFO Sheryl Sandberg has been telling institutional investors that the issuer " 'screwed up our IPO because we wanted to screw Wall Street.' " I have no idea if those exact words were used, and I sort of doubt it. But the point isn't really far-fetched. "Sandberg told a large institutional investor at one recent meeting that the firm decided to price the IPO at $38 a share—in what underwriters believed at the time was a steep price—not just to get the most possible money out of the deal, but also to avoid Wall Street traders from 'flipping' the stock, meaning they would buy shares at the opening price and sell them sometime later at a profit when shares start to rise amid additional investor demand. Sandberg said the company was seeking long-term investors who believe in Facebook's future, this person said. But when the investor questioned her on why the company allowed insiders and venture capitalist financiers to immediately trade out of the stock, she explained that was part of Facebook's 'culture,' according to one person with direct knowledge of the conversation." This is interesting to say the least. It would be interesting to speculate how the deal would have gone if the Nasdaq hadn't messed up so grandly. Sandberg might've gotten her wish. I doubt the stock was set to levitate the way Google did on offer. For more:
- here's the video
Related articles:
Citigroup's withering Nasdaq criticism
Facebook director cashes out
Bulls, bears battle over Facebook Read more about: Facebook IPO
back to top
3. Dispute over Bank of America's future Is Bank of America bent on returning to its traditional consumer banking roots, or does it aim to be a trading and investment banking powerhouse? The issue was highlighted by TheStreet.com, which noted differing points of view. Fairholme Capital portfolio manager Bruce Berkowitz, who counts Bank of America as a major holding, compares Bank of America to Wells Fargo saying that, "We believe that America's bank is returning to its retail roots (think of Wells Fargo) with a $1 trillion deposit franchise and that bank profits will skyrocket as legacy real estate loans burn-off." Rochdale Securities analyst Richard Bove, on the other hand, tells the publication that Bank of America management has given him the impression that they "see technology and capital markets as the future of the franchise with retail taking a back seat." The future "is not retail banking, nor is it lending money to large corporations." So which is it? Clearly, it is a little of both. Bank of America is not about to give up on the consumer market, though it is rationalizing its nationwide footprint, scaling back ATMs selectively, for example. Mobile banking seems to be an area of investment, as more people experiment with mobile banking and mobile transactions. When it comes to investment banking and trading, the intentions are a bit less clear. No one thinks it wants to wind down its Merrill Lynch trading and investment banking, but what sort of ambition does it have for such units? Does aim to be compete with Goldman Sachs and the other big banks across the board, or only selectively? Maybe management is fine with things as they are now. The revenue diversification has been nice. For more:
- here's the article Related articles:
Bank of America adds four more directors
Bank of America changes policy on old accounts Read more about: Bank of America, Consumer Banking
back to top
4. UBS reiterates opposition to Nasdaq Facebook offer Keeping up with Citigroup, which released a scathing indictment of the Nasdaq's many mistakes that resulted in the botched Facebook IPO, UBS has sent its own letter to the SEC. "UBS alone suffered losses in excess of $350 million, the vast majority of which resulted directly from Nasdaq's unprecedented failure to deliver execution reports for tens of thousands oftrades executed in the opening cross for the Facebook IPO. Nasdaq's failure to complete the standard opening cross procedures and to transmit execution reports for the Facebook IPO cross caused tremendous, unanticipated stress on UBS's retail market making system." The letter wasn't as long or as detailed as Citigroup's, but it makes strong points, one of which is that the Nasdaq's $62 million offer puts market makers in a position of having to either accept woefully inadequate restitution or embark on a long, costly fight. "The release requirement creates a fundamentally unfair dilemma for members: choose to execute the release and participate in the accommodation program - but at the risk of receiving a payment that, given the $62 million cap and limitations on the types of claim-eligible trades, is vastly disproportionate to its actual losses resulting from Nasdaq's unprecedented system failures on May 18 - or else forego participation and pursue potentially cost- and resource-intensive alternative avenues of recovery." The litigation would be epic, and paint the Nasdaq in an unfavorable light. The Nasdaq needs to realize that this issue is not going away; it needs to act. For more:
- here's the letter Related articles:
UBS vs. Nasdaq on Facebook losses
Latest Nasdaq offer on Facebook not enough Read more about: Citigroup, UBS
back to top
5. Columnist offers tepid support for Bank of America A New York Times' columnist recently wrote about her experiences using Bank of America's new mobile banking app to deposit checks, and was then hit with a fair amount of email, some of which expressed surprise that she was still banking with the much-maligned bank. In response, she wrote another column, expressing mild (and I do mean mild) support for the bank. "The reality for me is that Bank of America has yet to do something terrible enough to me, personally, to justify my taking the time I would have to spend to switch all of my accounts and bill payments to another bank." She also noted that she did "start to diversify my banking business after Bank of America's disturbing online banking outage last fall. If problems like that were to become routine, that would be the shove I'd need to run for the exit." And she admits that "I have been intrigued by reader comments about banks like USAA, which appears to have a fanatical following, as well as praise heaped upon various credit unions. These customers claim to 'love' their bank, while I find mine adequate for my needs. So, perhaps I need to raise my expectations about what a bank should provide and find some time in my packed schedule to explore other banking options." In a nutshell, this is probably how a lot of Bank of America customers---make that many big bank customers---feel about their institutions. Most do not develop highly personal relationships with their banks. They'll stick with it by inertia. They need a reason to switch, so don't give them one. For more:
- here's the article Related articles:
Consumer poll: Switching banks is too difficult
Big bank brands continue to suffer Read more about: Bank of America, Columnist
back to top
Also Noted SPOTLIGHT ON... Citigroup's celebrity hire The debate rages about the value of celebrity CEOs, but what about celebrity employees? Citigroup has hired former "America's Next Top Model" contestant and MTV anchor Kimberley Stolz for a job in equity derivative sales, according to Bloomberg. Stolz was already in the industry, leaving BTIG to join Citigroup as a vice president who will report to the head of flow equity-derivative sales. Previously, she was also an intern at Goldman Sachs. She also has a book on social media coming out. Citigroup is betting that she can make her unique history work with finance. She certainly likes to stay busy. Article Company News:
> Citigroup private bank redeems from Paulson. Article
> London Whale hires another lawyer. Article
> JPMorgan to invest in online retailer. Article
> Local drama at Wells Fargo. Article
> HSBC in talks to settle AML claims. Article
Industry News:
> Large bullion vault to open. Article
> Investment banking jobs fall. Article
> Customers happier with lower fees. Article
> Spain banks ailing. Article
> Cities avoid pension bets. Article
> Bank stocks immune to scandal? Article
Regulatory News:
> Money funds defeat regulators. Article
> Another fee controversy. Article
> FDIC sues banks over MBS. Article And Finally…More on Lance Armstrong. Article > Controls for automated trading. Can you rely on the sell-side alone? Wednesday, August 29th, 11 am ET / 8 am PT Join us for this informative and thought-provoking webinar, lead by renowned Capital Markets expert Richard Bentley, VP of Capital Markets, Progress Software . And learn how you can better mitigate and manage the risk of automated trading. Register today! > Webinar: Network Security: Emerging threats require updated Best Practices- September 12, 2pm ET/ 11am PT The security picture at financial services seems to be getting cloudier by the day. While many banks have awoken to the risks imposed by possible network breaches, the landscape continues to morph, raising the stakes. Cyber criminals continue to refine their techniques and to develop more advance hacking methods to compromise corporate networks, and they are as sophisticated as ever. The very notion of Best Practices in the realm of network management and security continues to evolve. We take a look at current trends and up-to-date practices. Register today!
| > Investment Consultants Forum - The Crowne Plaza Times Square, New York, NY - March 2, 2012 This conference provides a unique environment for developing dialogue between plan sponsors, managers and consultants. This event will feature panel-driven discussions focused on specific investment techniques of fixed income and hedge fund managers, the evolving role of institutional consultants, the manager evaluation process and more. Register today. > NFC Ticketing Europe 2012 - March 20-21 - London Come and join MasterCard, Renfe, Deutsche Bahn, Visa Europe, Orange, Arriva Netherlands, O2 and many more for the first event to bring together the whole NFC Ticketing industry for discussion, debate and quality networking. Click here. > NYIF Essentials of Project and Infrastructure Finance - September 10-12 - New York, NY This is a practical course that provides executives, whether as financiers, sponsors, or professional support, an opportunity to understand the risk-return character of limited recourse projects from multiple perspectives. Case studies span a variety of sectors and geographical regions. This course will not use in-depth models involving Excel™, but the instructor (a broad-based finance and investment executive with global experience throughout the U.S., Europe and the emerging markets of Latin America and Asia who has negotiated numerous transactions, including mergers and acquisitions, public offerings, mezzanine financings, international bank syndications, corporate valuations and fairness opinions) will review modeling approaches with examples. Register today. > Investment Trends Summit - September 12-14, 2012 - The Four Seasons, The Biltmore - Santa Barbara, CA The Investment Trends Summit is an educational forum focused on analyzing trends for the future, and exploring ways to implement new strategies in investment plans. Speakers and attendees will discuss topics such as investor's perspectives, investment management theories, and more. Register Today! > Investment Trends Summit - September 12-14, 2012 - Santa Barbara, CA Opal Financial Group's Investment Trends Summit will serve as an educational forum focused on analyzing trends for the future, as well as exploring ways to implement new strategies in particular investment plans. As one of our Platinum Series Events, we have designed this investment trends conference to meet the needs of money managers, senior pension fund officers and trustees who prefer smaller, more structured programs. By limiting this event to select managers, participants will be able to more carefully examine a distinct set of topics specifically tailored to their interests. > NYIF Wealth Management Program - October 29- November 16 - St. Petersburg/Tampa FL The 3-week Program captures the best practices and insights from corporate thought leaders and wealth management firms. This modular suite of classes is designed to prepare client-facing professionals with the knowledge and skills to meet and add value to wealthy individuals and families. The Program explores the following topics: Global Economic Impact on Wealth, Consultative Discussions and Recommendations, Asset Allocation and Portfolio Optimization, Lending and Leverage, Tax and Intergenerational Planning, and Maintaining Good Relationships with Investment Clients. Register today. > NFC Payments USA Unites NFC Experts in Boston Once Again - October 29-30 - Boston, MA NFC Payments USA (Oct 29-30th)is back for its second year, hosting 150 senior level delegates to debate industry challenges and facilitate the roll out of NFC payments. Speakers include Best Buy, PayPal, Verizon, Barclaycard, T-Mobile, Best Buy, VISA, Capital One, MasterCard. Click here for more information. > The Mobile Wallet Summit - November 28-29 - London The Mobile Wallet Summit is the only show that looks at the future of mobile transactions. It brings together every industry you find in your physical wallet, loyalty, identity, ticketing and payments and provides a forum for debate on how they will fit on your mobile.
| > Get Subscriptions to the Leading Finance Magazines for FREE Mercury Magazines offers top Finance titles for Free to professionals. No Credit Card Required. Stay Ahead in your Industry. Sign up now. > Whitepaper: Using Modern CRM to Attract and Retain Advisors and Clients Learn how this “next generation” CRM delivers game-changing benefits over early CRM options and can help your organization attract and retain top tier talent, foster customer loyalty, and grow assets under management or increase share of wallet/household. Download here. > Whitepaper: Ten Effective Habits of Indispensable IT Departments It's no secret that responsibilities are growing while budgets continue to shrink. Enact these ten IT habits throughout your financial institution to help you cut costs, create operational efficiencies and align IT to business goals. Download Today! | ©2012 FierceMarkets This email was sent to kumaresan.selva.blogger@gmail.com as part of the FierceFinance email list which is administered by FierceMarkets, 1900 L Street NW, Suite 400, Washington, DC 20036, (202) 628-8778.
Refer FierceFinance to a Colleague Contact Us Editor: Jim Kim
VP Sales & Business Development: Jack Fordi
Publisher: Ron Lichtinger Advertise Advertising: Jack Fordi or call 202.824.5040
Media Kit: www.fiercemarkets.com/advertise
Press Releases: email jimkim@fiercefinance.com Email Management Manage your subscription Change your email address Unsubscribe from FierceFinance Explore our network of publications: |
No comments:
Post a Comment