Subprime mortgages, greedy big banks and brokered deposits were at the root of the 2007 financial crisis, or so goes the case of federal regulators who helped saddle institutions big and small with Dodd- Frank. But a recent study by a former bank regulator and respected scholar, James R. Barth and a doctoral student Yanfei Sun, both from my alma mater, Auburn University, has … [Read more...]
FDIC’s welcome sign for de novos might as well be unplugged.
These days, when some in the political circle are calling for an expansion of Dodd-Frank, the chairman of the FDIC, Martin Gruenberg decided in April to ease regulations in an effort to try to jump start the creation of new banks. As you know, the number of de novos sagged after the Great Recession. In short, Gruenberg slashed the period of microscopic regulatory scrutiny … [Read more...]
Could FASB’s Proposal Put A Few Nails In Bankers’ Coffins?
I’ve written several articles about the future of banking, but it appears the Financial Accounting Standards Board could be putting nails in a few coffins. FASB’s complex proposal (Current Expected Credit Loss, or CECL) would force community banks to record a provision for credit losses the moment they make a loan. Let’s look back a few years at around 2007 and 2008, around … [Read more...]
What’s closing bank branches faster than the FDIC?
If you’ve heard it once, you’ve heard it a million times: mobile banking is going to change the banking industry. Sure, it won’t be overnight. But from all of the research I’ve seen, it won’t take long. I recently spoke at a Jack Henry Banking Educational Conference, where I held up my iphone and asked everyone what it was. As you can image, they all answered, “a phone.” I … [Read more...]