​Happy Friday & Happy Memorial Day Weekend!!!
 
Wishing everyone a very Happy Memorial Day as we honor those servicemen and servicewomen who have paid the ultimate price for our freedom.  Here is the Uncle Sean Update for 5/26/23:
 

• 👀 Certainly worth noting as Uncle Sean suspects we will see more of this from all regulatory authorities….  This week the OCC published a couple of regulatory updates:
  • The first was the updated "Liquidity" booklet of the Comptroller’s Handbook providing guidance on liquidity risk.  Some key area I found to be particularly interesting:
    • Surge Deposits, Reciprocal Deposits (deposit network services), increases in Borrowed Funds (and CoF).
  • Next came updates to the Bank Enforcement Manual to address actions against banks with persistent weaknesses.  The newly added Appendix C specifies, “Should a bank fail to correct its persistent weaknesses in response to prior enforcement actions or other measures, including those outlined above, the OCC will consider further action to require the bank to remediate the weaknesses. Such action could require the bank to simplify or reduce its operations, including that the bank reduce its asset size, divest subsidiaries or business lines, or exit from one or more markets of operation.” (bold emphasis added by Uncle Sean)
    • While the target is for banks above $50B in Assets, the OCC reserves the right to apply Appendix C to any bank “with operations that are highly complex or otherwise present a heightened risk.”
    • All of this ties in with Acting Comptroller Michael Hsu’s January comments regarding “too big to manage.”

 

• Pardon me while I geek out for a moment 😊 but Uncle Sean is seeing some good news on bank liquidity stress - Federal Reserve H.4.1 release on 5/25 showed the Bank Term Funding Program (BTFP) is working with $92B loaned out.  Meanwhile, primary credit from the discount window has dropped off to a more normalized $4B (down from $152.8B during that tumultuous week of March 15).

 

• More market sensing – JPMorgan Chase had their Investor Day this week.  No, I’m not going to cover all of this thankfully – but I do pay attention when they present about their credit reserves and forecasts on credit.  Afterall, they have a lot of economists on the payroll there so we might as well all benefit.  LOL!!!
  • I really liked the Firm Overview deck and in particular, slide 17 – “Credit remains benign, but we expect continued normalization throughout the year.”  Some cool points:
    • Reserved for peak unemployment forecast of 5.8% in late 2024
    • Building reserves as credit outlook has deteriorated; but expecting a return to normal (pre-pandemic) Net Charge-off’s of 0.6% by the end of 2023 after pandemic lows of 0.3%

 

• Venmo (by PayPal) announced the launch of the Venmo Teen Account (beginning June 2023) allowing parents and legal guardians to open a Venmo account for their teenagers between the ages of 13 – 17 with parental controls managed by the parent’s personal Venmo account.  The account also comes with a Mastercard debit card.

 

• PacWest Bancorp (Nasdaq: PACW; BHC for Pacific Western Bank) had a couple of asset sale announcements this week – I feel it is important to state that these have been well scripted and publicized by PacWest since the 4th quarter as they focus on their strategy of relationship-based community banking; and NOT a reflection of any recent market driven liquidity paranoia BS…  Okay – I’m better now, LOL!
  • PacWest Bancorp 5-19-2023 8K disclosing they are selling 74 RE construction loans with a value of $2.6B to a subsidiary of Kennedy-Wilson Holdings.  PacWest is also in the process of selling an additional 6 RE construction loans with a value of about $363M to Kennedy-Wilson pending due diligence.
  • Roc Capital Holdings (Roc360) announced they have purchased the RE origination assets of Civic Financial Services (CIVIC) from PacWest – pricing was not disclosed.

 

• Fifth Third Bancorp (Nasdaq: FITB) announced acquisition of Rize Money (embedded payments platform for fintech and other non-financial institutions) to enhance Fifth Third’s treasury management business.

 

• Daylight (neobank targeting the LGBTQ+ community) announced they are shutting down operations effective June 30.

 

• Marstone (digital wealth tech) partners with Red River Employees FCU (RRCU; Charter 5029; $1.4B Total Assets) to provide RRCU’s 115,000 members with digital wealth management platform.

 

• Good news for my Ag Banker friends – The seven basin states have reached an agreement to cut consumption and protect the Colorado River System.  A longer term agreement will need to be made as the current form only applies through 2026, but it is an excellent start with all parties understanding that conservation is critical.
  • Note California’s $50B agricultural industry as a major point of influence.

 

• Airbnb selects Stripe to offer Pay-by-Bank as a payment option for guests with a US bank account.

 

• Plastiq (business payments platform) filed for Chapter 11 Bankruptcy citing a series of events from a failed SPAC merger to the collapse of Silicon Valley Bank and with plans for a stalking horse sale to Priority Technology Holdings Inc.

 

• Notable FinTech funding for the week:
  • Onyx (neo bank targeting affluent younger professionals) raised $4.1M in new capital.
  • Episode Six (payment processing and digital ledger infrastructure) raised $48M in Series C funding round.
  • OpenFin (workspaces and developer platform for FIs) $35M in Series D round.
  • Unlimited (alt investment firm) raised $8M in Series A.
  • Pesto (alternative credit builder) raised $11M in Series A funding and takes on the pawn shop industry by launching the first asset-backed secured Mastercard consumer credit card.
  • Nymbus (FI tech vendor) raised $70M in Series D funding round.

 
 
Random Uncle Sean stuff:

• It’s Graduation Weekend for many parents including me and Aunt Patty!!!  Special shout out to Ms. Claire for graduating with honors today – Mom and Dad are SUPER proud of you!!!!
• Some quick Dad Jokes and then it’s time to get started with the weekend and graduation festivities:
  • Everyone knows that Alexander Graham Bell invented the telephone - but his brother, Taco, was working on some pretty important stuff too.
  • No matter how much you push the envelope, it’s still stationery…  😝
  • Is bacon grease an essential oil (asking for a friend)?
  • I just paid $3 for a Smartwater…  Obviously it’s not working…
  • Aunt Patty and I went to a restaurant and the manager greeted us and asked if I minded waiting a little bit.  I said, “no problem at all” and then he said “good – take these drinks to table four.”  😲 LOL!!!!

 
 
Have a GREAT Memorial Day Weekend and please stay safe!!!
 
Uncle Sean
 
 
Sometimes known as Sean Mayo – contact me directly for scope and pricing of custom reports / analysis projects at smayo@fedfis.com | 214-604-6961 – or you can contact FedFis Sales Team at 512-960-0911 | info@fedfis.com #FedFisHasTheData FedFis
 
FedFis, LLC disclaimer – The views and opinions of Uncle Sean are of his own and may not necessarily represent the views, endorsements, and/or opinions of FedFis, LLC – we all know he’s a little bit different; but that’s why we love him.
 

Happy Friday!!!
 
Very happy to report plenty of good news, financial wellness programs, and awesome partnerships this week - Here is the Uncle Sean Update for 5/19/23:

• Congratulations to Lise Kruse for being elected as the new CSBS Chair!!!!

 

• Uncle Sean loves this – two firms that I have great respect for doing great things together!  DCI and MOCA sign two banks to digital account platform featuring MOCA’s Digital-First NextGen Card-Based Payment Platform integrated with DCI’s advanced core processing and digital banking solutions.  Love it!!!!

 

• Plinqit (automated savings and financial wellness platform) partners with Sonata Bank to help the banks customers [particularly targeting the quick service restaurant (QSR) franchisees and their employees] grow savings while boosting their knowledge of personal financial wellness.  Uncle Sean is a huge advocate of financial literacy and financial wellness programs at all levels, so I am happy to see this.  😊

 

• More financial wellness…  Just in time for the upcoming student debt repayment moratorium expiration – PNC Bank announced PNC Student Debt Solution, powered by Candidly™ as an employee benefit platform for their business customers.  Nice work!!!!

 

• And even more financial wellness…  Truist Foundry (the division within Truist Bank focused on creating digital solutions) announced the launch of the Truist Long Game mobile app to help users build healthy financial habits with the chance to earn rewards deposited into a linked Truist deposit account.
  • Recall that Truist acquired the fintech Long Game back in May 2022.  The original Long Game “founder Lindsay Holden and her team now make up Truist Foundry, a cross-functional team with the goal of leading innovative growth to help Truist shape the future of finance for clients.”

 

• Arteria AI (digital documentation infrastructure) announced a strategic partnership with Compliance Systems (some great folks over there) to provide a joint solution that will provide community financial institutions with “streamlined, compliant digital documentation in a single solution giving them enhanced collaboration, workflow and data capabilities while driving efficiency and operationalizing the data within their documents” regardless of size / asset class.
  • Worth noting that Compliance Systems will be rebranding to TruStageTM Compliance Solutions.

 

• Meridian Bank (FDIC 57777; Total Assets $2.2B) partners with Corserv card issuing platform to launch a new business credit card program.

 

• Maxwell (Mortgage-as-a-Service B2B platform) announced the acquisition of LenderSelect Mortgage Group from Blue Ridge Bank (who had previously acquired LenderSelect back in Jan 2020) – pricing was not disclosed.  Check out their end-to-end platform including private label origination at himaxwell.com.

 

• The Federal Reserve released their semiannual Supervision and Regulation Report – Uncle Sean found the “Banking System Conditions” section to be really cool with a lot of good macro level data certainly worth paying attention to.
  • "Overall, banks have strong capital and liquidity, enabling them to lend and provide financial services to households and businesses," Fed Vice Chair for Supervision Michael Barr said in written remarks issued Monday. "At the same time, recent stress in the banking system shows the need for us to be vigilant as we assess and respond to risks."

 

• Wells Fargo agrees to pay $1 billion to settle shareholders' class-action lawsuit related to their (uh... well… um… ahem…) previous lawsuits - Yikes!!! 😲

 

• And finally, it was a busy week in Washington with plenty of bank related hearings from both the Senate and the House.  I’m not going to dig into this (thankfully as this dead horse has been beaten enough in the media), but if you really want to check some of it out – here is a pretty good list:
  • Federal Reserve Vice Chair for Supervision Michael S. Barr - full written testimony.
  • Acting Comptroller of the Currency Michael J. Hsu - oral statement as well as full written testimony.
  • FDIC Chairman Martin J. Gruenberg - full testimony.
  • NCUA Chairman Todd M. Harper - oral testimony as well as full written testimony.
  • Former Chief Executive Officer and President, First Republic Bank - testimony of Michael J. Roffler.
  • Banking Dive has a pretty good summary of the somewhat fiery testimony of SVB and Signature Bank execs.

 

• Notable FinTech funding for the week:
  • Zip (intake-to-pay platform) raised $100M in Series C funding round at a $1.5B valuation
  • Tipalti (end-to-end business payables platform) raised $150M in Growth Financing following $270M in Series F back in 2021.
  • Cardless (co-branded credit cards) secured a 3-year $75M credit facility.
  • Percent (credit marketplace) raised $30M in Series B funding round.

 
 
Random Uncle Sean stuff:

• It could be worse…..  Argentina just raised their benchmark interest rate by 600 bps to 97%....  WHOOF!!!!
• Texans everywhere are rejoicing as Bluebell and Dr Pepper team up to create new Dr Pepper Float flavored ice cream!!!!! Oh Yeah!!! 🤠
• You can stop scrolling now – LOL!!!!  Here are the Dad Jokes for the week!!!!
  • I set my ring tone to the theme from ‘Titanic’ – now my phone won’t quit syncing….  Hehehehehe!!!!
  • Does Sangria wine count as liquified fruit salad…???  Asking for a friend!!! 😊
  • In the South, chicken coups can’t have more than two doors – because if it had four it would be a chicken sedan….  (eyes rolling)…
  • Aunt Patty said I have C.D.O….  It’s like O.C.D. but all the letters are in alphabetical order as they should be!  😝

 
 
Have a GREAT WEEKEND and please stay safe!!!
 
Uncle Sean
 
 
Sometimes known as Sean Mayo – contact me directly for scope and pricing of custom reports / analysis projects at smayo@fedfis.com | 214-604-6961 – or you can contact FedFis Sales Team at 512-960-0911 | info@fedfis.com #FedFisHasTheData FedFis
 
FedFis, LLC disclaimer – The views and opinions of Uncle Sean are of his own and may not necessarily represent the views, endorsements, and/or opinions of FedFis, LLC – we all know he’s a little bit different; but that’s why we love him.

​Happy Friday & Happy Mother’s Day!!!
 
Perhaps a light week in the way of news updates is exactly what we need (I know I do!) after the last six weeks.  It’s also fitting that things appear much more calm on the eve of Mother’s Day Weekend as that is what Mom’s do.  They look after us, care for us, and know what’s best for us - and we all love you for that!!!  ❤️💕❤️  So I’m going to keep this one short so we can focus on the important things in life – celebrating Mother’s Day (err, Weekend - LOL).  Here is the much abbreviated Mother’s Day edition of the Uncle Sean Update for 5/12/23:

• The big news for the week came from the FDIC…  By utilizing the systemic risk exception and insuring all deposits for Silicon Valley Bank and Signature Bank failures, the FDIC Deposit Insurance Fund (DIF) took about a $15.8B hit.  Because of that exception, the law requires the FDIC to replenish the DIF via a special assessment.  The good news is that the FDIC DIF special assessment proposal will be borne mostly by the nations largest banks (95% of the assessment to be paid by banks with more than $50B in Assets); and completely exempts the vast majority of community banks from having to pay for this.  Nicely done!  😊

 

• The BLS April CPI came in at 4.9% YoY (expectation was 5% and March was 5%) marking the tenth straight month of declines.  We are getting there (recall that we were running 9.1% last June – check out this BLS CPI Chart)…
  • In the realm of ‘bad news is good news’ (I know…  It’s hard to say that out loud) from the Fed interest rate standpoint - Initial Jobless Claims came in at 264,000 for the week ended May 6 (245,000 expected, 242,000 previously) – that is the highest level since Oct 2021 per this St. Louis Fed (FRED) chart (FRED puts out some great stuff)!!!

 

• Blue Ridge Bankshares, Inc. announced the appointment of a new CEO for Blue Ridge Bank, N.A. – congratulations to Billy Beale!!!

 

• Western Alliance Bancorporation (NYSE: WAL) issued a deposit update showing stable (and growing) deposit base with ample liquidity to cover uninsured deposit exposures.  Kudos to WAL for being proactive and transparent – but it feels odd to me that this is the world we live in currently…

 

• The Federal Reserve released several docs this week:
  • Their biannual Financial Stability Report – kind of  long read at 85 pages, but does point to strength and resilience in the banking system; and a somewhat cautious tone related to CRE.
  • And the Senior Loan Officer Opinion Survey on Bank Lending Practices (SLOOS) citing modestly slight tightening of lending standards as well as weaker loan demand in many categories.

 

• Marcus by Goldman Sachs raised their deposit APY to 4.15% to match Apple’s savings product (sponsored by GS)……
  • Uncle Sean isn’t saying that the $1B in deposits that Apple drew in over the first week came from GS, but be careful what you wish for sometimes as a Sponsor Bank!!!  😲

 

• Interesting….  According to the WSJ, it appears that regulatory scrutiny of TD Bank's AML practices is what led to the termination of the $13.4B acquisition of First Horizon.
  • To be fair, a TD spokesperson said in a statement to the WSJ, “TD works diligently to prevent criminals from using the bank for illegal activity, to strengthen its risk management programs on an ongoing basis, and to protect the interests of our customers, the bank, and the financial system.”

 

• Affirm is partnering with FICO to build a “first-of-its-kind credit scoring model that would enable buy now, pay later loans to be consistently, transparently factored into credit and lending decisions and to be reported to the credit reporting agencies.”

 

• In the RE world, Dallas based Mr. Cooper announced an agreement to acquire Home Point Capital for $324M in cash while picking up Home Point’s $84B mortgage servicing portfolio.

 

• For my Ag Banker friends, the Tyson Foods earnings release (NYSE: TSN), which was painful as they lowered guidance, has a slew of USDA projections that are worth noting from a broader market perspective – particularly regarding beef and pork.

 

• Notable FinTech funding for the week:
  • 8fig (ecommerce funding and mgmt. platform) raised $140M in Series B funding round.
  • Petal (credit card fintech) raised $35M in new capital and announced the spinoff of their B2B infrastructure unit Prism Data as an independent company.
  • Charlie (neo banking app targeting the 62+ age community) raised $7.5M in capital.
  • Cable (all-in-one financial crime effectiveness testing platform) raised $11M in Series A funding.  Check out their Partner Bank & BaaS use case for real-time oversight of fintech programs – NICE!!!!

 
 
Random Uncle Sean stuff:

• The WHO downgrades the COVID pandemic stating it no longer qualifies as a global emergency after 3 years of dealing with the international crisis.
• And in celebration of Mother’s Day Weekend Uncle Sean brings to you, MOM JOKES!!!!  😍
  • Being a Mom to a teenager will make you understand why some animals eat their young.
  • You know when you buy a bag of salad and it gets all brown and soggy?  Cookies don’t do that!
  • Nothing is lost until Mom can't find it.
  • Mom's recipe for iced coffee: 1. Have kids. 2. Make coffee. 3. Forget you made coffee. 4. Drink it cold.
  • A police recruit was asked during the exam, “What would you do if you had to arrest your own Mom?'  He said, “Call for backup."
  • I like telling Mom Jokes… Sometimes she laughs…
  • And last but certainly not least (as the Dad Joke force is strong in this one)…..  I asked Mom to make me a sandwich and she said, “Poof, you’re a sandwich!”  😝

 
 
Have a GREAT MOTHER’S DAY WEEKEND and please stay safe!!!
 
Uncle Sean
 
 
Sometimes known as Sean Mayo – contact me directly for scope and pricing of custom reports / analysis projects at smayo@fedfis.com | 214-604-6961 – or you can contact FedFis Sales Team at 512-960-0911 | info@fedfis.com #FedFisHasTheData FedFis
 
FedFis, LLC disclaimer – The views and opinions of Uncle Sean are of his own and may not necessarily represent the views, endorsements, and/or opinions of FedFis, LLC – we all know he’s a little bit different; but that’s why we love him.

​Happy Friday!!!
 
Don’t forget to sign up here to have the Uncle Sean Update delivered straight to your inbox every week.  And without further ado, here is the Cinco de Mayo edition of the Uncle Sean Update for 5/5/23:
 

• Shout out to my friends at DCI as they renew their premier sponsorship of Bankers Helping Bankers and their dedication to helping community banks thrive!!!
  • "We are thrilled to partner with an organization that aligns so well with our mission to improve profitability and competitive position for community banks," said Sarah Fankhauser, DCI’s President and CEO. "As a company that is community bank centric and customer owned and led, we understand the importance and diligence it takes when considering technology solutions. This is where Bankers Helping Bankers shines.”

 

• It’s Fed Week!!!  As expected, the FOMC unanimously voted to raise rates by 25 basis points bringing the Fed Funds Rate to 5.00% – 5.25%.  This is the 10th consecutive rate increase.  Probably the most important statement was the move away from the term “anticipates additional policy firming” to being driven by incoming data at each meeting.  Here is the detailed info if you really want to get weird like me: 😊
  • Transcript of Chairman Powell's Press Conference (23 pages)
  • FOMC press conference video (49 minutes)
    • Not so fast….  April Jobs Report from the BLS showed a very strong +253K jobs for the month surpassing expectations of 180K while unemployment remained at 3.4% (expectation was 3.6%).  CNBC has a good summary.

 

• First Republic Bank was closed by regulators and purchased by JPMorgan Chase after revealing a $100B deposit run that resulted in no real way to profitability going forward.
  • JPM has a really good investor deck detailing the $10.6B acquisition and assumption of all deposits.
    • Some perspectives from Uncle Sean…  First Republic Bank now owns the dubious distinction of being the second largest bank to ever fail in the U.S. at $233B in total assets (second place was previously held by Silicon Valley Bank - yep).  Washington Mutual is still in first place.  Somewhat ironic, JPMorgan Chase was the bank that assumed the banking operations and all deposits of WaMu back in 2008.  Source: https://www.fdic.gov/bank/historical/bank/
  • I’m sure hoping we are done with this!!!

 

• In response to recent bank runs, the FDIC released a report titled, Options for Deposit Insurance Reform.  It’s a little long at 70+ pages but it is a really good read for risk freaks like me!  If nothing else, scroll through the graphs / tables and you will get a good sense of some macroeconomic trends facing banks from a deposit / ALM perspective.  If you are looking for a TLDR shortcut, FDIC Chairman Gruenberg gives a good and quick summary.  Essentially, the report looks at 3 options:
  • maintaining the current structure of Limited Coverage, including the possibility of an increased but clearly delineated deposit insurance limit.
  • Unlimited Coverage of all deposits.
  • Targeted Coverage (which is the regulators recommended approach), which would allow for higher or unlimited coverage for business payment accounts.

 

• Last week we saw writeups from the FDIC and the Federal Reserve regarding recent bank failures.  This week the GAO released their review of agency actions related to March bank failures (very much in line with the aforementioned FDIC and Fed reports).

 

• Land of Lincoln Credit Union (charter 63716; $391M Total Assets) to acquire Nokomis Savings Bank (FDIC 29532; $28M Total Assets).
  • If Land of Lincoln CU sounds familiar, well – it is…  Land of Lincoln also entered into a merger agreement to acquire Colchester State Bank back in December.
  • For those keeping score, this is the second CU acquisition of a bank so far for 2023.  That compares to 16 in 2022, 13 in 2021, 7 in 2020, and 16 in 2019 (source: FedFis)

 

• Greenwood announced the acquisition of Kinly (fka Tenth, fka First Boulevard) adding 300,000 Kinly community members to the Greenwood platform.

 

• Neural Payments (P2P platform) announced a multi-year agreement with Firstrust Bank in PA for “Neural’s P2P solution that will come fully-embedded within their Q2 digital banking platform.”

 

• No real surprise as this has been scripted for a while now, but TD Bank and First Horizon mutually agree to terminate their merger agreement as it did not appear that TD could get the necessary regulatory approvals completed by the already extended May 27 deadline.

 

• Western Alliance Bancorporation (NYSE: WAL) issued a public statement disputing claims made by Financial Times that the bank was considering a potential sale of all or part of its business.
  • This gets even better as WAL went on to say, “There is not a single element of the article that is true. Western Alliance is not exploring a sale, nor has it hired an advisor to explore strategic options.  It is shameful and irresponsible that the Financial Times has allowed itself to be used as an instrument of short sellers and as a conduit for spreading false narratives about a financially sound and profitable bank.  We are considering all of our legal options in response to today’s article. (bold emphasis added by Uncle Sean).  Heck yeah – I’d be mad too!!!!! 
  • Meanwhile…..  Reuters is reporting that US officials are assessing possible 'manipulation' on banking shares.  This could get very interesting!

 

• Franklin Templeton has launched a money market fund on the Polygon blockchain and becomes the “first U.S.-registered mutual fund to use a public blockchain to process transactions and record share ownership.”

 

• Synapse (BaaS middleware/connector platform) announced a partnership with AMG National Trust Bank as a bank partner.

 

• Wow – that brand power of Apple…  Forbes is reporting that the new Apple Savings account (Goldman Sachs) picked up close to $1 Billion in deposits within the first week of launch and $400M in the first day.  Holy Moly!!!  😮

 

• Notable FinTech funding for the week:
  • Setscale (trade finance – fka Float Financial) raised $79.5M in capital consisting of $9.5M Seed and $70M debt financing.
  • Slash (mobile banking app targeting entrepreneurs and online businesses) raised $19M in combined Seed + Series A rounds.

 
 
Random Uncle Sean stuff:

• WHAT?!?!?!  Aerosmith (yes, Uncle Sean is a fan!) announced their PEACE OUT Farewell Tour with special guest The Black Crowes (yep, also a fan).  The 40-date North American tour kicks off September 2nd in Philadelphia. 🤘 
• Did you know…..  May 4th (“Acquisition Day”) was the date that the U.S began working on the Panama Canal 119 years ago!!!  But the idea of connecting the two oceans dates back to at least the 1500's.
• And here they come – Dad Jokes:
  • I don’t want to get too technical, but according to chemistry – wine is a solution…
  • Han Solo had to send his steak back…  It was chewy…  🙄
  • One minute you are young and wild, the next you’re totally into air fryers!
  • Over 50 is when you start to find out why they call it the wee hours of the night!!!  🤣😂

 
 
Have a GREAT weekend and please stay safe!!!
 
Uncle Sean
 
 
Sometimes known as Sean Mayo – contact me directly for scope and pricing of custom reports / analysis projects at smayo@fedfis.com | 214-604-6961 – or you can contact FedFis Sales Team at 512-960-0911 | info@fedfis.com #FedFisHasTheData FedFis
 
FedFis, LLC disclaimer – The views and opinions of Uncle Sean are of his own and may not necessarily represent the views, endorsements, and/or opinions of FedFis, LLC – we all know he’s a little bit different; but that’s why we love him.
 

​Happy Friday!!!
 
Whew – tough week with all eyes on $200B First Republic Bank and an upcoming FOMC meeting next week that will likely result in another rate increase….  Here is the Uncle Sean Update for 4/28/23:
 

• Quick look at some macroeconomic data points that came out this week:
  • GDP came in at 1.1% in the first quarter of 2023 (well below median estimate of 1.9%) showing a material decline from the 2.6% increase in 4Q22.  However, the slowdown came in the form of inventory drawdown (which will almost certainly reverse) offset by increases in consumer and government spending.
  • Core PCE (the Fed’s favored inflation metric) landed at a stubborn 4.6% YoY rate in March.
  • All of which likely pave the way for more FOMC rate increases beginning next week.

 

• The Federal Reserve Board released their post-mortem review of the supervision and regulation of Silicon Valley Bank (SVB) failure.  Brace yourself for the shocking revelation (Uncle Sean sarcasm) that it was due to a bank run predicated by a “highly concentrated business model, and a reliance on uninsured deposits” leaving SVB “acutely exposed to the specific combination of rising interest rates and slowing activity in the technology sector that materialized in 2022 and early 2023.”  Additional key items point to:
  • The speed of the run was unprecedented; and technology enabled immediate withdrawals.
  • SVB’s board of directors and management failed to manage basic interest rate and liquidity risks.
  • Supervisors did not fully appreciate the extent of the vulnerabilities as SVB rapidly grew in size and complexity.
  • When supervisors did identify vulnerabilities, they did not take sufficient steps to ensure that SVB fixed those problems quickly enough.
  • The Board’s tailoring approach in response to the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA) and a shift in the stance of supervisory policy impeded effective supervision by reducing standards, increasing complexity, and promoting a less assertive supervisory approach.
    • Here is the full 118 page Federal Reserve report.

 

• Additionally, the FDIC released their report detailing supervision of Signature Bank (SBNY) failure.  Not surprising to see some common threads with the SVB review above.  Failure was due to a bank run “precipitated by contagion effects in the wake of the announced self-liquidation of Silvergate and the failure of SVB, after both experienced deposit runs.”  Rapid growth in concentrated industries (VC and PE), exposure to crypto industry turmoil, and an “overreliance on uninsured deposits”.  Additional key items from the report:
  • The speed with which depositors withdrew funds from SBNY and SVB was unexpected and surprised the regulators and the banking industry.
  • The root cause of SBNY’s failure was poor management from unrestrained growth without developing and maintaining adequate risk management practices and controls.
  • Failure to understand the risk of its association with and reliance on crypto industry deposits or its vulnerability to contagion from crypto industry turmoil.
  • Several SRs related to liquidity risk management, Bank Secrecy Act/Anti-Money Laundering (BSA/AML), and model risk management (MRM) remained outstanding for multiple examination cycles.
  • FDIC communications of examination results were not always timely to SBNY board.  FDIC resource challenges were also cited.
    • Here is the full 63 page FDIC report.

 

• Based on the two failed bank reviews, I would speculate that a tougher regulatory environment going forward is a foregone conclusion…..  Mhmm – here’s my shocked face…  😬😬😬

 

• Binance.US has terminated the $1.3B Voyager Digital bankruptcy acquisition stating “hostile and uncertain regulatory climate in the United States has introduced an unpredictable operating environment impacting the entire American business community.”  Meanwhile, Binance CEO hires lawyers as Feds probe 'egregious' conduct…. 
  • Yep, these two instances sure seem linked to me. 😲

 

• The NCUA has filed charges against Jefferey B. Moats, the former CEO and board member of Edinburg Teachers Credit Union (ETCU; charter 66366), for knowingly causing a substantial loss to ETCU exceeding $4M.  They are also issuing a civil money penalty of $1M against Moats.
  • ETCU was previously conserved back in March 2021 and the NCUA removed Moats from his position at the CU due to his actions.  ETCU was later released from conservatorship (a feat not often accomplished) in January of this year.

 

• DailyPay (on-demand / EWA platform) continues to add large bank clients (Santander, PNC Bank, TD Bank) as their business clients add EWA as a service to their employees.  The article also recognizes DailyPay as the “second-largest user of The Clearing House’s real-time payments network, behind only digital payment pioneer PayPal and its Venmo unit.”

 

• Melio (B2B payments) announced partnership with Shopify where Melio will power Shopify Bill Pay allowing merchants to easily schedule, pay, and manage their vendors and contractors from the same Shopify admin platform.

 

• Be Careful!!!  The FDIC and OCC flagged specific overdraft practices as “unfair or deceptive practices” including APSN debit card transactions.

 

• And more regulatory statements….  The CFPB, DOJ, EEOC, and FTC issued a joint statement on enforcement efforts against discrimination and bias in automated systems.
  • The emphasis is on tech marketed as “artificial intelligence / AI” with the goal of taking bias out of decision making - actually has the potential to produce outcomes that may result in unlawful discrimination.

 

• Well now….  This is getting interesting….  Recall last month where the SEC issued a Wells Notice to Coinbase recommending that the “SEC file an enforcement action against the Company alleging violations of the federal securities laws.”  Coinbase has already sued the SEC citing lack of clarity on regulations…
  • Early on Thursday of this week, SEC Chairman Gensler posted a video on Twitter basically stating that crypto markets suffer from a regulatory compliance problem, not a clarity issue…  Of course he did not name any specific companies.
  • HOWEVER, later that same day, Coinbase posted their own video stating they do not list securities; AND announced that they “are prepared to defend that position in court.” 
    • Uncle Sean is not an attorney (that statement is actually quite laughable), but good luck with continuing to sue your primary regulator…. 😮

 

• Notable FinTech funding for the week:
  • Super (savings app and credit builder) raised $85M in Capital consisting of $60M Series C plus a $25M credit facility.
  • Summer (student debt management / repayment platform) raised $6M in Series A extension round.
  • IDPartner (online identity verification platform) raised $3.1M Seed round in the smoking hot digital identity space.

 
 
Random Uncle Sean stuff:

• Okay – we are going to get straight to some Dad Jokes so we can turn off the TV / media streaming and go outside and play!!!!!
  • What if there were no hypotheticals…..  😊
  • I have a statistical average joke, but it’s mean…. (oh I love that one)
  • If the earth really was flat, cats would have pushed everything off of it by now.
  • One of the big differences between me and Aunt Patty is that if she says “smell this” – it probably smells nice…  😂
  • As Spock once said, “don’t play around with superglue…”  🖖🙃

 
 
Have a GREAT weekend and please stay safe!!!
 
Uncle Sean
 
 
Sometimes known as Sean Mayo – contact me directly for scope and pricing of custom reports / analysis projects at smayo@fedfis.com | 214-604-6961 – or you can contact FedFis Sales Team at 512-960-0911 | info@fedfis.com #FedFisHasTheData FedFis
 
FedFis, LLC disclaimer – The views and opinions of Uncle Sean are of his own and may not necessarily represent the views, endorsements, and/or opinions of FedFis, LLC – we all know he’s a little bit different; but that’s why we love him.
 

​Happy Friday!!!
 
Here is the Uncle Sean Update for 4/21/23:
 

• Previously announced back in October, Apple’s new high-yield savings account is now available sporting a respectable 4.15% APY through Goldman Sachs.
  • One key consideration – you have to have the Apple Credit Card (also issued by Goldman Sachs) to qualify for the savings account.  But keep in mind that the CC cash back rewards can be applied daily to the savings account; and you can add or withdraw from the savings account via the wallet app - balance can be transferred to Apple Cash or a regular bank account at any time.  Payments Dive has a good summary.
    • Interesting that Marcus (Goldman Sachs direct digital bank) is only offering 3.9% APY on savings as of 4/21/23.  Ahhh the pricing power of Apple versus the cost of sponsor bank liquidity (HOLY COW that was deep – LOL 😝).

 

• Meanwhile, Goldman Sachs is actively exploring the sale of GreenSky, the consumer focused alt lending and loan servicing fintech it acquired last year for $2.24B in an all-stock transaction.

 

• Show me the money!!!  NACHA announced Same Day ACH Helps Lead ACH Network to Strong First Quarter Growth – let’s take a quick peek at some of the 1Q23 numbers:
  • Total ACH = 7.7 billion payments valued at $19.7 trillion, each representing an increase of 6.4% over the first quarter of 2022.
    • Same Day ACH saw big increases a year after the transaction amount was almost doubled to $1M.  Same Day ACH = 186.2 million payments (up 20.7%) representing $565.3 billion (a 94.7% increase).
  • For reference – 2022 total ACH for the year was 30 billion payments valued at $77 trillion

 

• Zelle P2P trajectory continues to increase as they announced strong double digit growth for 1Q23 highlighting # of transactions grew 29% to 639M and transaction amount grew 31% to $180B.  The number of institutions on the Zelle Network is now over 1.900. 
  • For reference - 2022 total Zelle transactions for the year was 2.3 billion Zelle® payments with a total value of $629 billion.

 

• Greenwood (digital banking platform for Black and Latino individuals and businesses) is live and has successfully enrolling all interested waitlist users.  In addition to banking features, Greenwood continues their affinity focus on community as they have also “successfully launched Elevate, a premium unique wrap-around banking and lifestyle product exclusively for Greenwood members, and acquired The Gathering Spot, A3C and Valence to provide its members with unparalleled access to professional networking opportunities, exclusive experiences, and more.”

 

• Mastercard announced Cross-Border Services Express in the ever expanding international remittances space (also very big on the fintech side).  This new tool allows financial institutions to easily set up international payments as a turn-key integration for their customers including small and medium-sized enterprises (SME’s).  Couple of key points:
  • Mastercard is collaborating with leading fintechs Fable FinTech and Payall Payment Systems to deliver this light-touch, quick-to-market solution through a seamless user interface.
  • Digital payments are seeing strong growth with three-quarters of consumers who send and receive cross-border payments doing so through mobile apps, according to Mastercard’s 2022 Borderless Payments Report.

 

• Q2 announced the launch of Q2 Instant Payments Manager designed to “help financial institutions manage instant payment workflows from end-to-end with the new Clearing House RTP® and Federal Reserve FedNow instant payment rails.”

 

• Some good ole embedded finance for my fellow Texans 🤠 – YeeHaw!!!  H-E-B grocery and their subsidiary Central Market (430 locations in Texas and Mexico) launched its own credit card with 5% cash back on the grocer’s private-label products and 1.5% on all other purchases anywhere Visa is accepted.
  • This comes only 6 months after H-E-B announced their consumer mobile bank account app with Mastercard debit card with product specific rewards, mobile deposit capture, and high-yield savings account.

 

• Lili (business banking app) announced the launch of Lili Smart, integrating accounting software into the business banking app creating accounting categorizations of transactions as they happen in real time.  Nice! 😊

 

• Notable FinTech funding for the week:
  • Clerkie (personalized solutions to build credit) raised $33M in Series A funding round.
  • Rally (fully customizable e-commerce checkout platform) raised $12M in Series A round.
  • Charm Solutions (developer of an AI powered SMB Credit Advisor service) raised $3.5M in Seed funding
  • Pro Platforms (PROP – a home improvement and construction fintech) raised $4.7M in venture capital and announced the launch of Construct CRM operating system that includes project financing.  They also have plans to expand into banking / treasury services (Homepro pay) including payment processing, mobile deposit capture, unlimited business debit cards, and project based spend management.

 
 
Random Uncle Sean stuff:

• I ran across this while doing some “market research” (cough, cough) and I may have to try this out!!!  Pour some Buffalo Trace Distillery Bourbon Cream in with some cold root beer for an adult version of the classic root beer float….  Yep, sounds nice!!!!  🍺
• Alright – let’s close this out with some classic Dad jokes:
  • Is it just me or does Justin Bieber with all of his tattoos kind of remind you of that middle school desk in detention class???  😁
  • 4/21 - also known as National Surprise Drug Test Day….
  • Jet Skis should have been called boatercycles…
  • Golf is clearly the adult version of an Easter egg hunt!
  • I tried calling the tinnitus hotline, but it just kept ringing….
  • Remember….  It’s all $hits and giggles until someone giggles and $hits…  😮🤣

 
 
Have a GREAT weekend and please stay safe!!!
 
Uncle Sean
 
 
Sometimes known as Sean Mayo – contact me directly for scope and pricing of custom reports / analysis projects at smayo@fedfis.com | 214-604-6961 – or you can contact FedFis Sales Team at 512-960-0911 | info@fedfis.com #FedFisHasTheData FedFis
 
FedFis, LLC disclaimer – The views and opinions of Uncle Sean are of his own and may not necessarily represent the views, endorsements, and/or opinions of FedFis, LLC – we all know he’s a little bit different; but that’s why we love him.
 

​Happy Friday!!!
 
Here is the Uncle Sean Update for 4/14/23:
 

• April is Financial Literacy Month!!!  As a reminder, there are plenty of free resources if you need them for your customers, constituents, or any advocate programs you may be hosting:
  • The Federal Reserve - Federal Reserve Education.org equipping educators, educating students, and empowering consumers
  • FDIC – Money Smart financial education program to help people of all ages enhance their financial skills and create positive banking relationships
  • NCUA - Financial Literacy & Education Resource Center offering a host of resources and outreach programs
  • OCC - Financial Literacy Resource Directory providing ample resources, issues, and events that are useful to bankers, organizations, and consumers of all ages
  • CFPB - Consumer Tools and Educator Tools to help you advocate for the people you serve
  • US Treasury - Financial Literacy and Education Commission showcasing news and resources as well as a national education website - MyMoney.gov
    • “Wealth does not create financial literacy, rather it is financial literacy that creates wealth and ultimately financial independence.” – Uncle Sean 😊

 

• WHEW!  There was a slew of economic data this week pointing towards softening inflation – let’s take  quick look (spoiler alert – economic data is cooling by design):
  • The BLS March CPI data came in at 0.1% (lower than estimate of 0.2%, and down from 0.4% actual in Feb).  YoY came in at 5% (lower than estimate of 5.1%, and down from 6% in Feb).  YoY CPI has declined in each of the last 9 months. 
    • Core CPI came in exactly as expected at 0.4% for March (versus 0.5% in Feb) and YoY of 5.6% (versus 5.5% in Feb).
  • March PPI data also came in slightly cooler for March at -0.5% and 2.7% YoY down from 4.9% in Feb (and massively down from March 2022 which was 11.7%).

 

• Walmart is suing Capital One, their co-branded credit card issuer, to end the co-branded partnership early citing unfulfilled contractual terms.
  • Warning – some Uncle Sean speculation here…  One (snicker – see what I did there) can’t help but wonder if this is a preemptive strategy for Walmart’s newly acquired fintech named ONE to take over card-issuing….  Afterall, ONE is led by former Goldman Sachs executives.  Hmmm….

 

• TransPecos Banks, SSB (FDIC 1178) has partnered with Episode Six to bring card issuing and processing products to the banks customers – a/k/a bank driven BaaS sponsorship initiative via Cards-as-a-Service.  Very nice!!! 👍

 

• Visa announced Visa+ to support interoperability between P2P apps – specifically PayPal and Venmo via partnerships with DailyPay, i2C, TabaPay, and Western Union.
  • You can check out more on Visa+ here.
  • Meanwhile, CFPB Director Chopra wants certain payment firms to be labeled as "systemically important" – notably Cash App, PayPal, and Venmo in relation to how many consumers use the apps to store funds outside of the banking system.

 

• Plaid continues to evolve and has announced Instant Payouts on Plaid Transfer.  By incorporating Real-Time Payments (RTP®) on Plaid Transfer, Plaid can now offer their customers a multi-rail 24/7/365 payment option consisting of TCH RTP (based on eligibility), same-day ACH, or standard ACH.

 

• Square (owned by Block) integrated spring product release showcasing nearly 100 new features and dozens of integrated tools designed to “help sellers diversify revenue streams and automate operations.”  Payments Dive also has a good overview.

 

• And so it begins…???  Twitter partners with eToro to give users the option to buy and sell stocks and other assets from eToro.
  • To be clear, Twitter users can already view real-time index funds and some companies (umm - Tesla, of course) via the existing “cashtags” feature.  The new partnership with eToro allows cashtags to be expanded to cover more instruments and asset classes.  You will now be able to click on a link to take you direct to eToro to buy and sell on their platform.
    • “Clicking a link to eToro” is not what Uncle Sean would call embedded finance, but it is an expected expansion of Twitter towards financial services nonetheless…

 

• FinFit and Salary Finance U.S. announce merger and will operate under the FinFit brand serving “over 500,000 U.S. employers and over 10 million U.S. employees.”

 

• Bluevine and Wise launched an international bill pay solution for Bluevine’s US SMB customers.

 

• KeyBank (FDIC 17534) selected Qolo to power KeyBank’s integrated API-based payment solutions and virtual accounts.

 

• Notable FinTech funding for the week:
  • Elevate (modern employee benefit platform) raised $28M in growth funding.
  • Clear Street (“modern infrastructure” for capital markets) raised $270M in Series B2 at a $2B valuation.
  • Brassica Technologies (infrastructure API for alternative investment ecosystem) raised $8M in Seed funding and announced that its wholly-owned subsidiary Brassica Trust Company has been granted a Trust Charter by the Wyoming State Banking Board.
  • Altruist (custodian and software provider for investment advisory industry) raised $112M in Series D round.
  • Martini.ai (AI-powered corporate credit analysis) raised $6M Seed Round.
  • Tradier (retail brokerage and trading platform) raised $24.6M in Series B funding.
  • This is for my Ag Banker friends – Carbon Robotics (AgTech firm producing AI-powered robotics) raised $30M in Series C funding round.  Check out their LaserWeeder™ - that is awesome!!!!
    • Uncle Sean loves AgTech!!!! ❤️

 
 
Random Uncle Sean stuff:

• Queue up The Beatles - Taxman…  Well, I hope everyone has their taxes done (I don’t so my weekend is gonna suck - LOL)….  Just as a reminder - Tax Day is April 18th and is also the deadline for 1Q23 estimated tax payments….     
  • Normally taxes are due on April 15th, but we get a reprieve this year since the 15th falls on a Saturday and the District of Columbia has an Emancipation Day holiday on Monday, April 17.
• In “celebration” of income taxes (grrrrr), here are some Dad Jokes:
  • Pretty sure they call it the 1040 because for every $50 you earn, you get to keep $10 and they get $40….
  • Did you hear the one about the fun IRS agent?  Me neither… 😊
  • George Washington never told a lie, but he also never filed a 1040!!!
  • I heard that IRS auditors use their personality for birth control…  LOL (yeah - probably going to get in a little trouble over that one)😲
  • Recent legislation resulted in a 3.14% tax on booty taken by buccaneers…  Also referred to as the pi-rate tax…
  • Okay – this one isn’t really tax related (other than married filing joint)….  Aunt Patty is so nice – she told me, “wisdom has clearly been chasing you, but you’re a really fast runner!”  Thanks???  LOL!!!!! 😝

 
 
Have a GREAT weekend and please stay safe!!!
 
Uncle Sean
 
 
Sometimes known as Sean Mayo – contact me directly for scope and pricing of custom reports / analysis projects at smayo@fedfis.com | 214-604-6961 – or you can contact FedFis Sales Team at 512-960-0911 | info@fedfis.com #FedFisHasTheData FedFis
 
FedFis, LLC disclaimer – The views and opinions of Uncle Sean are of his own and may not necessarily represent the views, endorsements, and/or opinions of FedFis, LLC – we all know he’s a little bit different; but that’s why we love him.
 

Happy Good Friday!!!
 
Fintech | Banking | Data – it’s not just what we do, it’s who we are.  For the best (and sometimes entertaining) market research, sign up here to have the Uncle Sean Update delivered straight to your inbox every week!  Here is the Uncle Sean Update for 4/7/23:
 

• Bankers Helping Bankers (BHB) is at it again this week!  The BHB Fund is excited to announce a capital investment in RiskScout, a leading regtech company specializing in compliance automation for FI’s – check them out at riskscout.com. 

 

• Jamie Dimon released his 2022 Annual Letter to Shareholders.  There are plenty of summary takes out there related to Jamie Dimon’s op-ed sections, so I will politely decline to summarize as I don’t want to infer or influence anyone else’s opinion (like I have any real influence – HA!).  I do, however, encourage reading this as it is packed with a ton of information.  There are plenty of areas where not everyone will agree on all points (including myself), but it is good info nonetheless.
  • Uncle Sean will admit that I did laugh when I saw The Motley Fool refer to Jamie Dimon as “America's shadow Treasury Secretary” – LOL!!!!

 

• Sorry Charlie (see what I did there)….  The DOJ and the SEC charged Charlie Javis with multiple counts of fraud over the $175M sale to JP Morgan alleging Charlie “falsely and dramatically” inflated the number of customers Frank actually had in a scheme to “fraudulently induce” JPMorgan to acquire the startup.
  • The official charges include conspiracy to commit wire and bank fraud, wire fraud, bank fraud, and securities fraud.
  • “This arrest should warn entrepreneurs who lie to advance their businesses that their lies will catch up to them, and this Office will hold them accountable for putting their greed above the law,” Damian Williams, U.S. attorney for the Southern District of New York, said in a statement.  WHOOF!!!  😲

 

• Digital Onboarding announced that their platform is now accessible through the Jack Henry Banno digital platform.
  • Full disclosure – I still have my DO hat and I love it!!!!

 

• Citizens Bank of Edmond partners with Narmi to offer digital account opening for the bank’s consumer and business customers.

 

• Allied Solutions selects MANTL as its preferred solution provider to help financial institutions enhance the digital new account opening process and automate back-office tasks.

  

• Richmond City Employees FCU (charter 14768; $7M Total Assets) was merged with NCUA assistance into Kemba Credit Union (charter 61810; $1.6B Total Assets).
  • Richmond City Employees FCU was originally conserved on Dec 12, 2022 citing the standard “unsafe and unsound practices” – Sept 2022 call report showed a material loan charge-off bringing their Net Worth capital ratio to a Significantly Undercapitalized 2.32% (down even more to 2.03% as of Dec 2022 call report) – source: FedFis CU data platform.

 

• Bunq (European neobank) announced that they have applied for a U.S. banking charter to serve European expatriates in the U.S. “with strong ties to both sides of the Atlantic.”

 

• SoFi acquires Wyndham Capital Mortgage in an all-cash deal (pricing was not disclosed but is expected to be accretive within six months).

 

• Acorns (investing and savings app) acquires GoHenry, a European based neobank (with a presence also here in the U.S.) focused on money management and financial literacy for 6-18 year-olds.  In the U.S., GoHenry will operate as GoHenry by Acorns.

 

• Apiture announced the launch of Business Insights for their business banking customers via an integration with Monit’s cash flow, forecasting, and guidance platform for FI’s to provide to their business customers.

 

• Pacific West Bank announced a partnership with Unit allowing Pacific West Bank to embed banking services into Unit’s middleware / connector platform.

 

• Flush with $80B in long-term funding, the IRS has released their Strategic Operating Plan (150 pages) on how they will utilize this new budget money over the next few years. 
  • Uncle Sean was happy to see that the IRS did produce a “TLDR one-pager version” for the rest of us that shows the high-level roadmap of the 5 key objectives and milestones broken down by short-term (FY 2023 – 2024) and longer-term (FY 2025 – 2028). 
    • Heck if nothing else, just simplifying that 150 pg doc into a one-pager is a GREAT start on improving the IRS – LOL!!!! 😊  Oh dear – I hope I don’t get audited now….  😲

 

• Notable FinTech funding for the week:
  • Hype (f/k/a Pico, a marketing and payments platform for creators and small businesses) raised $10M in Series A round.
  • Earned (f/k/a Forme Financial – a comprehensive financial planning & advisory / wealth management service designed specifically for physicians) raised $12M in Series A funding round as they emerge from stealth and transition the brand from Forme to earnedwealth.com over the next six months.
  • Prism (alt lending) raised $26M in Capital consisting of Seed and Series A.  Prism works directly with pre-IPO technology companies to allow employees of those startups to borrow against their company equity for personal use.

 
 
Random Uncle Sean Stuff:

• Wishing everyone a very Happy Easter – and best of luck to all on the upcoming Easter Egg hunt! 
• And finally, here are some Dad Jokes to get you into Easter Weekend:
  • Remember – we’re all here because we’re not all there…..  Wait, what???  😊
  • If you wear a full suit of armor to bed, you’ll get a good knight’s sleep…..
  • Olives really should be called Greece’s pieces.
  • (shout-out to Brad Giddens at Integris | CalTech for providing this one to me) – What is the difference between a camera and a foot?  Well, a camera has photos and a foot has five toes….  😝
  • Old rabbits have gray hares….
  • And lastly – I don’t suffer from insanity…  I actually enjoy every minute of it!!!

 
 
Have a GREAT Easter weekend and please stay safe!!!
 
Uncle Sean
 
 
Sometimes known as Sean Mayo – contact me directly for scope and pricing of custom reports / analysis projects at smayo@fedfis.com | 214-604-6961 – or you can contact FedFis Sales Team at 512-960-0911 | info@fedfis.com #FedFisHasTheData FedFis
 
FedFis, LLC disclaimer – The views and opinions of Uncle Sean are of his own and may not necessarily represent the views, endorsements, and/or opinions of FedFis, LLC – we all know he’s a little bit different; but that’s why we love him.
 

​Happy Friday!!!
 
Whoa - where did the 1st quarter go???  Here is the Uncle Sean Update for 3/31/23:

• The Bankers Helping Bankers (BHB) platform has been B-U-S-Y!!!!
  • First is a HUGE shoutout to Liberty Bank as the latest to join the BaaS Association as our community of innovative institutions continues to expand!
  • Second – the BHB Fund marks its first investment placement in FinGoal, an insights platform focused on personalization for digital banking to help banks better serve their customers through real-time insights and product / service recommendations.  Congrats to David Nohe and the entire FinGoal Team!

 

• First-Citizens Bank & Trust Company (FDIC 11063; $109B Total Assets) to acquire substantially all loans and deposits of Silicon Valley Bridge Bank, N.A. at a discount of $16.5B and excludes about $90B in securities and other assets.
  • You can check out the very well done First Citizens Banchshares Investor Deck that basically doubles the size of First-Citizens, diversifies the client base, and details out some very nice downside protections including a five-year loan loss share coverage with the FDIC and an available line of credit from the FDIC for contingent liquidity needs if needed.

 

• The CFTC has sued Binance and owner Changpeng Zhao as well as Samuel Lim (Binance’s former Chief Compliance Officer) alleging willful evasion of U.S. law that violated the Commodity Exchange Act. 😲
  • Banking Dive has a good summary if you want to dig in a little more.

 

• CSI also hits this week with a pair of announcements:
  • CSI partners with Hawk AI to provide CSI customers with automated AI-driven solutions for fraud and AML.
  • CSI hires industry veteran Linda Fischer as Chief Operating Officer as well as John Blevin as SVP General Counsel.  Also announced was a slew of promotions including Kurt Guenther to CRO, Allison Maddock to CPO, and Tara Schultz to SVP Strategy. 

 

• Check out Seattle Bank with their own series of announcements this week:
  • Capitalizing on embedded finance on the lending side as they announced a partnership with LoanStar Technologies that allows merchants on the LoanStar network to offer point-of-sale consumer loans from Seattle Bank for high-value transactions.
  • Also on the lending side - announcing a partnership with JUDI.AI to offer Seattle Banks “small business borrowers a simplified loan application and approval process that now takes minutes instead of a week or more.”

 

• And one more set of double announcements as BM Technologies (NYSE: BMTX – fka BankMobile) makes headlines:
  • BMTX announced new Deposit Processing Services Agreement (DPSA) with First Carolina Bank as well as an updated DPSA for T-Mobil MONEY with Customers Bank.
  • BMTX hires industry veteran Raj Singh as Co-CEO.

 

• Uncle Sean likes this – North Dakota is the first state in the nation to approve legislation requiring cybersecurity education in K-12 classrooms.  Education is always good – especially related to our new digital world!!!!  😊

 

• Rocket (NYSE: RKT) announce the launch of Rocket Visa Signature Card credit card (via Rocket Money, powered by Deserve, and issued by Celtic Bank) targeting home buyers / homeowners with up to 5% rewards that can be used towards closing costs and down payments.

 

• Greenlight (teen and family focused banking app) announced the launch of Greenlight for Banks to allow banks and credit unions to offer Greenlight’s suite of banking and education products to their customers through a co-branded landing page and app.  “With Greenlight for Banks, financial institutions can seamlessly integrate family banking into their own ecosystems, allowing them to engage the next generation of customers, grow deposits, and provide more value to families.”
  • Worth noting, the article references existing customers WaFd Bank, Morgan Stanley, and Community Financial Credit Union – WOW!!!!

 

• The OCC announced the establishment of its Office of Financial Technology as an expansion of their existing Office of Innovation.  Prashant Bhardwaj will lead the office as Deputy Comptroller and Chief Financial Technology Officer, effective April 10, 2023.  The Office of Financial Technology “will enhance the OCC’s expertise on matters regarding digital assets, fintech partnerships, and other changing technologies and business models within and that affect OCC-supervised banks.”

 

• Just ICYMI (and I don’t know how as it felt like it was everywhere all week long - LOL), Apple has finally launched Apple Pay Later from closed Beta – albeit to a limited amount of randomly selected users via invite for now.
  • Apple Pay Later is a BNPL product built within the Apple Wallet allowing users to split purchases of $50 - $1,000 into four interest free installments over six weeks. 

 

• And more news from the mobile wallet arena – Early Warning Services LLC (EWS) has named their new multi-bank digital wallet Paze and will be aimed exclusively for online transactions.  Pilot is expected this summer with broad availability expected in late 2023 (and available to all banks).  Per the Paze website, “Over 150 million eligible credit and debit cards available at full launch” giving them wide customer coverage from the start.

 

• Notable FinTech funding for the week:
  • StellarFI (credit enhancing platform via bill payments) raised $15M in Series A funding round.
  • Spiral (Impact-as-a-Service™ - ESG assessment) raised $28M in Series A funding to help banks and fintech companies embed sustainability and social impact into their business.
  • Raisin (known as SaveBetter in the US – a deposit platform for high-yield savings products with a network of banks and credit unions) raised about $64.7M in Series E round ($60M euros) to accelerate growth in the U.S.
  • Playbook (PFM focused on tax-advantaged decisioning) raised $7M in Series A funding round.
  • Presta (digital lending platform) raised $3.3M in pre-seed funding.
  • Stratyfy (AI-driven lending solutions for FI’s) raised $10M in capital.

 
 
Random Uncle Sean Stuff:

• The bracket busting NCAA Men’s Final Four is set for Saturday evening with the Championship game scheduled for Monday, Apr 3.
• Alright – we’re going to keep this short as I really want to sneak out this afternoon, grill some hamburgers, and maybe even have a few adult beverages (don’t tell my boss – LOL)….  So let’s get right to some quality Dad Jokes to kick off the weekend right!!!!
  • I just sold my two homing pigeons on Facebook Marketplace for the 25th time…. 😊
  • If laziness was an Olympic sport, I would come in 4th just so I wouldn’t have to walk up to the podium.  LOL!!!!
  • I asked the waiter, “what’s the duck like?”  He looked me straight in the eyes and said, “It’s kind of like a chicken, but it can swim.”  Yep, that’s a good one!!!!
  • Daylight Savings was really rough on me this year…  I literally lost sleep over it….
  • Hey Aunt Patty – I get it now…  When our parents used to say to us “enjoy them while they are young” – they were talking about our knees and hips, not our kids!  HAHAHAHAHA!!!! 😝

 
 
Have a GREAT weekend and please stay safe!!!
 
Uncle Sean
 
 
Sometimes known as Sean Mayo – contact me directly for scope and pricing of custom reports / analysis projects at smayo@fedfis.com | 214-604-6961 – or you can contact FedFis Sales Team at 512-960-0911 | info@fedfis.com #FedFisHasTheData FedFis
 
FedFis, LLC disclaimer – The views and opinions of Uncle Sean are of his own and may not necessarily represent the views, endorsements, and/or opinions of FedFis, LLC – we all know he’s a little bit different; but that’s why we love him.

​Happy Friday!!!
 
Don’t forget to tell your friends that they can sign up here to have the Uncle Sean Update delivered straight to their inbox every Friday (all the cool kids are doing it - LOL).  Here is the Uncle Sean Update for 3/24/23:
 

• Shout-out to Sunrise Banks (a CDFI) as the latest innovative institution to join the BaaS Association!!!!

 

• It’s FED WEEK!!!  As most everyone expected, the FOMC raised rates for the ninth time in a row by 25 basis points bring the target Fed Funds rate to 4.75% - 5.00%.  Some key observations:   
  • The U.S. banking system is sound and resilient.  Job gains have picked up, unemployment rate remains low, and inflation remains elevated.
  • Guidance has changed from ongoing hikes to some policy firming may be appropriate.  Recent events in the banking system are likely to result in tighter credit conditions for households and businesses, such a tightening in financial conditions would work in the same direction as rate tightening. 
  • Going forward the FOMC “will be focused as always on the incoming data and the evolving outlook, and in particular on our assessment of the actual and expected effects of credit tightening.”
    • Here is the written transcript (23 pages) of Chair Powell’s press conference; and here is the video (43 minutes).
    • Here is the Summary of Economic Projections (“dot plot”) showing the same target of 5.1% year-end rate projection as the last FOMC meeting. 

 

• This is fantastic – DCI (yep – the core processor that has been gobbling up market share) announced the launch of GoDeposits.  “By successfully eliminating the need for middleware, GoDeposits eradicates the need for Fintechs and financial institutions to work around the core processor. Today, DCI's partners are empowered to track transactions through DCI, ruling out the once-essential demand for third-party involvement. No friction in the 90-second application, 100% compliance, all KYC, options for funding, and multi-branding—all through one instance of core and no middleware.”
  • Some cool points here:
    • Removing that middleware / third-party infrastructure layer is HUGE for both banks and fintechs!  This effectively takes a link out of the monetary supply chain for DCI Sponsor Banks; and that helps by 1) reducing risk while enhancing compliance, 2) reducing cost, and 3) enables DCI banks to be BaaS/Sponsor Bank Ready for new account / deposit onboarding.
    • This is a shining example of what Uncle Sean continues to refer to as, “bringing Banking-as-a-Service back to the Bank.”  I love it!!! 😊

 

• The SEC has issued a Wells notice to Coinbase as a precursor to potential charges related to potential violations of U.S. securities law – specifically regarding staking services.  Coinbase’s CEO Brian Armstrong posted on Twitter that his company is “right on the law, confident in the facts, and welcome the opportunity for Coinbase (and by extension the broader crypto community) to get before a court.”
  • Uncle Sean smells settlement in the air and potential offshoring of Coinbase.  Time will tell….

 

• American Express is finally shutting down Kabbage Checking (powered by Green Dot Bank) as of June 30, 2023.
  • To be clear, this move has been scripted for a while since AMEX announced Business Blueprint banking solution for SMBs (includes business checking / AMEX debit card, line of credit, ability to accept online card payments, and expense / cash flow insights).

 

• Pinwheel (payroll API for direct deposit switching) announced the launch of Direct Deposit 2.0 expanding from payroll to now include direct deposit for gig wage (contractor) and benefit payment platforms such as unemployment and SSI.

 

• NYCB’s Flagstar Bank, NA (FDIC 32541, $90B Total Assets) acquired substantially all deposits and certain loan portfolios of Signature Bridge Bank, NA.

 

• ICYMI, the Economic Report of The President was submitted to Congress this week – it’s 513 pages and no, I did not read it all – LOL.  However, Chapter 8 caught my attention as it is titled Digital Assets: Relearning Economic Principles – and it’s not very positive.  Specifically on page 238, “Indeed, crypto assets to date do not appear to offer investments with any fundamental value, nor do they act as an effective alternative to fiat money, improve financial inclusion, or make payments more efficient; instead, their innovation has been mostly about creating artificial scarcity in order to support crypto assets’ prices—and many of them have no fundamental value.”
  • WOW – In my best Jim Carey / Ace Ventura voice, “alrighty then!!!”  😲

 

• CLA (CliftonLarsonAllen LLP), the eighth largest professional services firm in the U.S., teamed up with KlariVis to be an exclusive nationwide provider of the KlariVis dashboard and analytics solution for the financial services industry.

 

• Fiserv and Central Payments (the BaaS subsidiary of Central Bank of Kansas City) partner together to help fintech brands and financial institutions create innovative debit programs.

 

• Homebot (consumer RE home equity insight portal) announced the acquisition of Quo Finance, a mortgage app for first time home buyers.

 

• Coming to America – Pay.com partners with Cross River to expand to the U.S. and create an all-inclusive payments platform for business and merchants.

 

• Notable FinTech funding for the week:
  • Rippling (business workforce management platform) raised $500M in Series E funding round – this blog timeline from Parker Conrad (co-founder and CEO) as fallout from SVB is amazing and worth the read.
  • Rain (EWA) raised $116M in capital consisting of $66M in Series A equity funding and $50M in debt.
  • Caramel (digital checkout and authentication platform with the goal of transforming private party and independent dealer car sales) raised $12M in Seed funding – check them out at drivecaramel.com.
  • Beam (construction GC / subcontractor payment platform) raised $4M Seed Round .

 
 
Random Uncle Sean Stuff:

• I ran across these the other day while I was surfing the internet – OOPS – I mean “working” – LOL!!!!  😝  As a parent, these are nothing short of hilarious…  Words of wisdom from children:
  • Never trust a dog to watch your food. – Patrick, age 10
  • When your Dad is mad and asks you, “Do I look stupid?” don’t answer him. – Michael, 14
  • Never tell your Mom her diet is not working.  Michael, 14
  • Stay away from prunes.  Randy, 9
  • Never pee on an electric fence.  Robert, 13
  • When your Mom is mad at your Dad, don’t let her brush your hair.  Taylia, 11
  • Don’t sneeze in front of Mom when you’re eating crackers.  Mitch, 12
  • Puppies still have bad breath even after eating a tic tac.  Andrew, 9
  • Never hold a dust buster and a cat at the same time.  Kyoyo, 9
  • You can’t hide a piece of broccoli in a glass of milk.  Amir, 9
  • If you want a kitten, start out by asking for a horse.  Naomi, 15
  • Felt markers are not good to use as lipstick.  Lauren, 9
  • Don’t pick on your sister when she’s holding a baseball bat.  Joel, 10
  • When you get a bad grade in school, show it to your Mom when she’s on the phone.  Alyesha, 13
  • Never try to baptize a cat.  Eileen, 8

 
 
Have a GREAT weekend and please stay safe!!!
 
Uncle Sean
 
 
Sometimes known as Sean Mayo – contact me directly for scope and pricing of custom reports / analysis projects at smayo@fedfis.com | 214-604-6961 – or you can contact FedFis Sales Team at 512-960-0911 | info@fedfis.com #FedFisHasTheData FedFis
 
FedFis, LLC disclaimer – The views and opinions of Uncle Sean are of his own and may not necessarily represent the views, endorsements, and/or opinions of FedFis, LLC – we all know he’s a little bit different; but that’s why we love him.