The Systemic Risk Council, in a comment letter to the Federal Reserve and the Office of the Comptroller of the Currency, warned that the Fed's proposal to lower capital requirements for the largest U.S. banks would "expose the American economy and people to unnecessary risks." The private-sector group, which includes several top former regulators, supports the move to simplify rules but noted that the proposed change would "make the U.S. banking system materially less resilient."
In other regulatory news, the New York State Department of Financial Services reminded regulated banks, insurance companies, and other financial services institutions that they should be in compliance with cybersecurity regulations by Sept. 4. Regulated entities would need to have policies and procedures ensuring the use of secure development practices for IT personnel and an audit trail to sufficiently reconstruct financial transactions to support normal operations if a breach occurs, among other requirements.
On Capitol Hill, the U.S. House Financial Services Committee will invite Fannie Mae CEO Timothy Mayopoulus and Federal Housing Finance Agency Director Mel Watt to testify in a hearing to be scheduled "no later than" Sept. 27. The committee is currently investigating allegations of "waste, fraud and abuse" at the FHFA and the government-sponsored enterprises Fannie Mae and Freddie Mac.
Massachusetts' Office of the Attorney General is investigating LendingClub Corp.'s advertising and disclosure practices to consumers. The online lender said it is cooperating with the probe, which is in its early stages. The company is being sued by investors and the Federal Trade Commission for its allegedly false 'no hidden fees' claim.
In fintech news, Dun & Bradstreet Corp. is being sold to an investor group led by private equity firms CC Capital, Cannae Holdings Inc., and funds affiliated with Thomas H. Lee Partners LP. The deal is valued at $6.5 billion, including the assumption of $1.1 billion of Dun & Bradstreet's net debt. Deal completion is expected to occur within six months, upon which Dun & Bradstreet will become a privately held company.
Investment Technology Group Inc. is in talks with the U.S. Securities and Exchange Commission to settle a probe into operational features of its POSIT alternative trading system in the U.S. and access to U.S. POSIT data.
In other parts of the world
Asia Pacific: Dai-ichi Life unit to buy Suncorp life business; New Zealand holds cash rate
Europe: Prudential, L&G, Zurich report earnings; Italy eyes Monte dei Paschi sale
Middle East & Africa: Mizrahi Tefahot will not settle US probe for $342M; Saudi-Canada row escalates
Now featured on S&P Global Market Intelligence
WSFS goes big in Philadelphia with $1.5B deal, plans major tech investments: WSFS Financial Chairman, President and CEO Mark Turner said the deal is "intended to level that playing field" with national banks and aggressive fintechs.
Investment managers reflect on industry's future beside the lake at Camp Kotok: The group of economists, money managers and other market followers at the annual Camp Kotok gathering talked about the future of financial services and politics. Cumberland Advisors Chairman and Chief Investment Officer David Kotok said nearly everybody "expects fee compression to continue."
The day ahead
Early morning futures indicators pointed to a higher opening for the U.S. market.
In Asia, the Hang Seng climbed 0.88% to 28,607.30, while the Nikkei 225 fell 0.20% to 22,598.39.
In Europe, around midday, the FTSE 100 fell 0.72% to 7,721.01, and the Euronext 100 was down 0.31% to 1,074.53.
On the macro front
The jobless claims report, the Producer Price Index-Final Demand report, the wholesale trade report, the Energy Information Administration's natural gas report, the Federal Reserve balance sheet and the money supply report are due out today.
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