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2 Arkansas banks in deal; SEC again postpones decision on bitcoin ETF

In Arkansas, Farmers Bank & Trust Co. is buying Bank of Prescott in a deal set to close in the third quarter. The terms of the deal were not disclosed.

Elsewhere, New York-based Broadridge Financial Solutions Inc. agreed to acquire RPM Technologies Inc., a Canadian provider of enterprise wealth management software solutions and services, for approximately $300 million.

On May 20, Monroe, N.C.-based American Bank & Trust became the first bank to open in North Carolina since the financial crisis, American Banker reports. The bank's organizers raised $22.5 million, with the group looking to continue selling common shares through June 30.

The U.S. Securities and Exchange Commission once again postponed its decision to approve a proposed rule change, filed by Cboe Global Markets Inc.-owned Cboe BZX Exchange Inc., to list and trade shares of SolidX Bitcoin Shares, a bitcoin exchange-traded fund issued by the VanEck SolidX Bitcoin Trust, to gather additional comments on the proposal. The SEC had previously extended its review process of the proposed rule change to Feb. 27.

Precidian Investments LLC received the SEC's approval to offer an actively managed, non-transparent exchange-traded fund, Pensions & Investments reports. The ETF, called ActiveShares, would not reveal its full, everyday portfolio to the market, but only to a broker that would act as an "authorized participant representative," and provide the basket value of the portfolio every second as compared to existing ETFs which provide the value every 15 seconds.

The prevalence of leveraged lending among banks is one of the key threats to the banking industry's stability, according to Office of the Comptroller of the Currency's "Semiannual Risk Perspective" spring report. Much of the credit risk associated with such lending falls outside the banking industry, making it difficult for banking regulators to completely examine the risks in leveraged lending.

Federal Reserve Chairman Jerome Powell flagged the risks of leveraged lending and other forms of riskier corporate borrowings due to business debt being at historically high levels, but said he does not believe that business debt loads could result in the next financial crisis.

In an interview with CNBC, Federal Reserve Bank of Atlanta President Raphael Bostic said the U.S. economy continues to experience solid growth and does not need an interest rate cut, despite businesses facing increased uncertainty due to trade tensions. Although market expectations point towards an easing in the interest rate policy amid weaker growth and below-target inflation figures, Bostic said he is "not expecting a rate cut to be imminent," as information gathered from businesses and elsewhere does not show the U.S. will see "significant weakness in the economy" that would call for a rate cut to take place.

The Consumer Financial Protection Bureau's assistant director for enforcement, Kristen Donoghue, has stepped down after joining the agency in 2011, sources told American Banker. Cara Petersen, the principal deputy to the assistant director for enforcement, will become acting director of enforcement.

In other parts of the world

Asia Pacific: BoComm Life gets OK on wealth subsidiary; Pakistan raises key interest rate

Europe: Nationwide CFO retiring; Tesco Bank exits mortgage lending; HSBC's China push

Middle East & Africa: Mizrahi Tefahot Bank posts rise in Q1 profit; Israel's central bank holds rate

Now featured on S&P Global Market Intelligence

US banks with the highest Texas ratios in Q1'19: The number of U.S. banks and thrifts with an adjusted Texas ratio above 100% fell to 16 in the first quarter from 22 in the fourth quarter of 2018.

H8: Consumer, real estate loans drive total loan growth at US banks in April: Total loans and leases at U.S. commercial banks rose to $9.72 trillion in April, largely powered by a $10.1 billion increase in consumer loans and a $9.9 billion increase in real estate loans, according to the Federal Reserve's H.8 report.

The day ahead

Early morning futures indicators pointed to a higher opening for the U.S. market.

In Asia, Hang Seng fell 0.47% at 27,657.24, while the Nikkei 225 shed 0.14% to 21,272.45.

In Europe, around midday, the FTSE 100 gained 0.76% to 7,366.61, and the Euronext 100 lifted 0.59% to 1,050.67.

On the macro front

The Redbook Index for retail sales and the existing home sales report are due out today.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

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