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OCC Reports Key Risks, Effects of COVID-19 in Federal Banking System
November 9, 2020--The Office of the Comptroller of the Currency (OCC) today reported the key issues facing the federal banking system and the effects of the COVID-19 pandemic on the federal banking industry in its Semiannual Risk Perspective for Fall 2020.
Banks remain in strong financial condition but profitability is stressed due to low interest rates and increasing levels of provisions for problem loans. The OCC reported credit, strategic, operational, and compliance risks, among the key risk themes in the report.
Highlights from the report include:
Credit risk is increasing as the economic downturn impacts customer ability to service debts.
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Source: Office of the Comptroller of the Currency (OCC)
U.S. still faces possible default wave, asset declines due to pandemic: Fed
November 9, 2020--The United States may still face a wave of debt defaults and "significant declines" in asset prices because of the coronavirus pandemic and recession, the Federal Reserve warned on Monday, in a stark reminder the economy is far from out of the woods.
"As many households continue to struggle, loan defaults may rise, leading to material losses" for lenders, the Fed said in its latest biannual Financial Stability Report. Business debt "has risen sharply as businesses increased borrowing to weather the period of weak earnings. The general decline in revenues associated with the severe reduction in economic activity has weakened the ability of businesses to services these obligations."
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Source: reuters.com
In first for Fed, U.S. central bank says climate poses stability risks
November 9, 2020--The U.S. Federal Reserve for the first time called out climate change among risks enumerated in its biannual financial stability report, and warned about the potential for abrupt changes in asset values in response to a warming planet.
"Acute hazards, such as storms, floods, or wildfires, may cause investors to update their perceptions of the value of real or financial assets suddenly," Fed Governor Lael Brainard said in comments attached to the report, released Monday.
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Source: reuters.com
Federal Reserve publishes latest version of its supervision and regulation report
November 6, 2020--The Federal Reserve Board on Friday published the latest version of its supervision and regulation report, which summarizes banking conditions and information about the Federal Reserve's bank regulatory and supervisory activities.
The current edition includes detailed information on the strength of the banking system in light of the economic and financial stresses from the COVID--19 containment measures. Additionally, it describes current areas of supervisory focus from the Federal Reserve as well as how banks and bank supervisors have adapted to a largely remote working environment.
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Source: federalreserve.gov
From veganism to #BLM: Big Data promises to transform niche ETFs
November 8, 2020--Better research and targeting of thematic funds is enhancing their appeal, experts say
Ethan Powell says he has a vision. The founder of Impact Shares wants to get to the day when someone "likes" a pro-Black Lives Matter item on social media and then finds themselves presented with an advert for the non-profit's NAACP Minority Empowerment exchange traded fund.
Mr Powell is not alone in thinking that day is not far off. Advances in big data and artificial intelligence look set to expand the reach of so-called thematic ETFs, which allow investors to focus on anything from Christian values, to water shortages or particular social issues.
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Source: FT.com
Federal Reserve issues FOMC statement
November 5, 2020--The Federal Reserve is committed to using its full range of tools to support the U.S. economy in this challenging time, thereby promoting its maximum employment and price stability goals.
The COVID-19 pandemic is causing tremendous human and economic hardship across the United States and around the world. Economic activity and employment have continued to recover but remain well below their levels at the beginning of the year.
Weaker demand and earlier declines in oil prices have been holding down consumer price inflation. Overall financial conditions remain accommodative, in part reflecting policy measures to support the economy and the flow of credit to U.S. households and businesses.
The path of the economy will depend significantly on the course of the virus. The ongoing public health crisis will continue to weigh on economic activity, employment, and inflation in the near term, and poses considerable risks to the economic outlook over the medium term.
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Source: federalreserve.gov
House Republicans introduce bill to forbid financial transaction taxes
November 5, 2020--Two key Republican House members have introduced a bill that would prohibit states from imposing taxes on financial transactions.
Rep. Patrick McHenry, R- N.C., ranking member on the House Financial Services Committee, and Rep. Bill Huizenga, R-Mich., ranking member on the Investor Protection, Entrepreneurship and Capital Markets Subcommittee, unveiled the Protecting Retirement Savers and Everyday Investors Act on Oct. 27.
The bill's introduction comes at a time when lawmakers in New Jersey are considering a proposal that would levy a tax on all stock trades that occur in New Jersey, where the major exchanges house their processing centers. Exchanges, like the New York Stock Exchange and Nasdaq, and groups like the Securities Industry and Financial Markets Association, oppose the proposed tax.
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Source: pionline.com
IMF Executive Board Concludes 2020 Article IV Consultation with Mexico
November 4, 2020--Mexico has been hit hard by COVID-19. Official statistics indicate that over 85,000 lives have been lost. About 12 million workers lost their jobs, many of whom came from the informal sector, out of which around 4 million have not returned to the workforce. The share of the population in working poverty jumped from 36 to 48 percent, as of June.
Output is expected to decline by 9 percent in 2020, the steepest contraction since the Great Depression. It is expected to recover modestly going forward. Although inflation has edged up on account of exchange rate passthrough and supply disruptions, it is projected to decline gradually as domestic demand remains suppressed by labor market dislocation, wealth effects, and concerns about the path of the pandemic.
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Source: IMF
Indxx Exceeds $10 Billion in Assets Tracking its Indices
November 4, 2020--Indxxis excited to announce that products tracking Indxx indices have surpassed the $10 billion assets under management landmark. Founded in 2005 and with offices in New York, Miami, Prague and New Delhi, Indxx is full-service index provider that is redefining indexing by bringing innovative product solutions to the market.
PK Sen Sharma, Founder & Managing Partner at Indxx, said, "It's been an incredible journey for us since our establishment in 2005. We started the company with an aim to bring innovative solutions to the indexing space. I'm very delighted at the progress we’ve made as a company and our contributions to the industry.Kudos to the entire team."
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Source: Indxx
NYSE wins back listing crown from Nasdaq after luring Spacs
November 1, 2020--Boom in blank-cheque company launches adds new twist to age-old rivalry between exchanges
The New York Stock Exchange is on track to steal back the crown for US stock market listings from its rival Nasdaq this year after tapping into the booming market for blank cheque companies.
Companies have raised $66bn through listings on NYSE this year compared with $61bn on Nasdaq, according to Dealogic, with nearly two-thirds of the proceeds raised on NYSE coming from special purpose acquisition companies-Spacs-which have become one of the hottest fads on Wall Street.
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Source: FT.com
