Frank Toth’s Post

Wall Street Journal article from today: "Fed Backpedals on Plan to Increase Big Bank Capital," https://lnkd.in/eRWHCUCn I would be interested in what bankers have to say about these proposed capital requirements for big banks. I'm sympathetic to banks that want to be able to lend freely without a lot of government regulations reducing efficiency. But I'm also sympathetic to the Federal Reserve, whom these banks come crawling to for bailouts when things go bad. I'm a believer in the idea of moral hazard, where bailouts for banks encourages riskier behavior by banks because they don't incur the costs if things go awry.

𝐋𝐞𝐭'𝐬 𝐭𝐚𝐥𝐤 𝐚𝐛𝐨𝐮𝐭 𝐡𝐨𝐰 𝐛𝐚𝐧𝐤𝐬 𝐚𝐫𝐞 𝐝𝐨𝐢𝐧𝐠! ❓Are we heading into the next banking crisis? ❓Why should you keep an eye on the US commercial real estate market? ❓Are banks and regulators taking the situation seriously? 𝐅𝐢𝐧𝐝 𝐨𝐮𝐫 𝐭𝐚𝐤𝐞 𝐨𝐧 𝐢𝐭 𝐡𝐞𝐫𝐞: https://rb.gy/89fkbi. One thing is for sure: 𝐁𝐚𝐧𝐤 𝐬𝐭𝐚𝐛𝐢𝐥𝐢𝐭𝐲 𝐢𝐬 𝐧𝐨𝐭𝐡𝐢𝐧𝐠 𝐭𝐨 𝐛𝐞 𝐭𝐚𝐤𝐞𝐧 𝐟𝐨𝐫 𝐠𝐫𝐚𝐧𝐭𝐞𝐝 - even if to some, it might have seemed like it for a while. #banks #assetprotection #wealthmanagement

𝐋𝐞𝐭'𝐬 𝐭𝐚𝐥𝐤 𝐚𝐛𝐨𝐮𝐭 𝐡𝐨𝐰 𝐛𝐚𝐧𝐤𝐬 𝐚𝐫𝐞 𝐝𝐨𝐢𝐧𝐠! ❓Are we heading into the next banking crisis? ❓Why should you keep an eye on the US commercial real estate market? ❓Are banks and regulators taking the situation seriously? 𝐅𝐢𝐧𝐝 𝐨𝐮𝐫 𝐭𝐚𝐤𝐞 𝐨𝐧 𝐢𝐭 𝐡𝐞𝐫𝐞: https://rb.gy/89fkbi. One thing is for sure: 𝐁𝐚𝐧𝐤 𝐬𝐭𝐚𝐛𝐢𝐥𝐢𝐭𝐲 𝐢𝐬 𝐧𝐨𝐭𝐡𝐢𝐧𝐠 𝐭𝐨 𝐛𝐞 𝐭𝐚𝐤𝐞𝐧 𝐟𝐨𝐫 𝐠𝐫𝐚𝐧𝐭𝐞𝐝 - even if to some, it might have seemed like it for a while. #banks #assetprotection #wealthmanagement

𝐋𝐞𝐭'𝐬 𝐭𝐚𝐥𝐤 𝐚𝐛𝐨𝐮𝐭 𝐡𝐨𝐰 𝐛𝐚𝐧𝐤𝐬 𝐚𝐫𝐞 𝐝𝐨𝐢𝐧𝐠! ❓Are we heading into the next banking crisis? ❓Why should you keep an eye on the US commercial real estate market? ❓Are banks and regulators taking the situation seriously? 𝐅𝐢𝐧𝐝 𝐨𝐮𝐫 𝐭𝐚𝐤𝐞 𝐨𝐧 𝐢𝐭 𝐡𝐞𝐫𝐞: https://rb.gy/89fkbi. One thing is for sure: 𝐁𝐚𝐧𝐤 𝐬𝐭𝐚𝐛𝐢𝐥𝐢𝐭𝐲 𝐢𝐬 𝐧𝐨𝐭𝐡𝐢𝐧𝐠 𝐭𝐨 𝐛𝐞 𝐭𝐚𝐤𝐞𝐧 𝐟𝐨𝐫 𝐠𝐫𝐚𝐧𝐭𝐞𝐝 - even if to some, it might have seemed like it for a while. #banks #assetprotection #wealthmanagement

A divergence between large and small cap banks have left investors wondering if any narrowing is on the horizon. KBW Head of U.S. Bank Research Christopher McGratty, CFA tells CNBC, “There are two factors. One is rates, higher for longer is harder for the regionals; and two, credit quality is more of an issue for smaller banks”. Watch below:  #largecaps #smallcaps #investors #interestrates #creditquality

It was a pleasure joining Becky Quick on CNBC Squawk Box this morning to discuss important banking industry news. In my view, this is an inflection point for banks as they navigate an economic “soft landing”. We’re looking for orderly interest rate cuts, a reversal of the inverted yield curve, and also expect modest revenue growth for banks in the second half of the year. #InterestRates #FederalReserve #BankingSector #BankingIndustry #Regulation

Fed Chair Powell says it’s unlikely we’ll see another real estate-led banking crisis, like in 2008. But he predicts some smaller banks might close or merge out of existence. “There will be certainly -- there will be some banks that have to be closed or merged out of, out of existence because of this. That'll be smaller banks, I suspect, for the most part. You know, these are losses. It's a secular change in the use of downtown real estate. And the result will be losses for the owners and for the lenders, but it should be manageable.” cbsn.ws/3ul4A42

“More than 300 banks had half of their assets in securities in the third quarter, Federal Deposit Insurance Corp. data analyzed by The Wall Street Journal showed. At roughly 100 of those banks, the total was more than 75%. Across U.S. banks, 19% of assets were securities at midyear, according to New York Fed data.” Banking Crisis Plays Out at America’s Smallest Lenders | via The Wall Street Journal https://lnkd.in/e2-bMJGq

What are big banks meant to do with hundreds of billions in excess deposits when loan demand is weak? #JPMorgan and #BankofAmerica had very different strategies: One boosted profits, the other caused headaches. Read more at Bloomberg Opinion >>

New York Community Bank's stock plunged today after it boosted reserves and cut its dividend in the fourth quarter to meet the tougher demands of running with the big banks - the need for additional capital to meet regulatory requirements. Latest from Phil Scipio and me for IFR. NYCB said the dividend cut and the sharp increase in loan loss provisions were part of the lender's preparations for its new life as a Category 4 bank. NYCB gained that status after it bought a large chunk of Signature Bank's assets last year after that bank collapsed at the start of the regional banking crisis of 2023. The acquisition pushed assets under management at NYCB above the US$100bn thereshold, making it subject to new capital and liquidity requirements proposed last year. Even before NYCB's results, analysts said banks with assets of just above US$100bn would need to aggressively grow to justify the additional compliance and capital costs that came with a Category 4 desgination. Otherwise, it might make more sense to pare down the bank and avoid that threshold altogether. https://lnkd.in/es6TgxUm