​Happy Friday!!!
 
Coming at you live this week from our 2022 Roundup Conference which was AWESOME – already looking forward to 2023!!!!  Here is the Uncle Sean Update for 11/4/22:
 

• WOW – what an AMAZING time at our FedFis Roundup Conference sponsored by IBAT!!!! 
  • Our opening panel on Day 1 featuring “bank born products” clearly set the tone of open collaboration between community banks.  Special thank you to Marco Perez with their BANCreach product, as well as Brad Womack with Kleberg Bank and their FINTX rewards platform, and of course Mike Fernandez with Texas National Bank in Sweetwater and their newly launched Bankers Lender product (which is actually a direct digital bank).  This wasn’t just a product showcase, it was an open discussion of WHY and (more importantly) HOW they built it.
    • Also – quick tip of the hat to Chris Bibb – “go Bibb or go home!”  LOL!!!!
  • Day 2 was a whirlwind of roundtable discussions and finished up at Luckenbach, TX with BBQ and The Bellamy Brothers band!
  • Our last day of the Roundup was “BaaS Day” – my absolute favorite!!!!!  Shout out to Eugene Shvartsman with Cross River for delivering a consistent message of open cooperation and collaboration between community banks to strengthen each other….  This was undeniably the common theme at the Roundup this year.  Uncle Sean is seeing an exciting transformation in the industry and a new definition of the term “community” amongst community bankers.  I am so proud to be a part of this passionate movement - very cool!!!  😊

 

• It’s Fed Week!  Yep, the FOMC raised rates 75 basis points, as expected, for the fourth consecutive time this year bringing the target Fed Funds target rate to 3.75% - 4.00%.  Although there were hints that the Fed “might” slow the rate increases going forward, Chairman Powel made it clear in the press conference that it was premature to discuss any pause in rate increases.  And the stock market completely threw up – LOL!
  • For the full info in case you want to get your “inner Fed Geek” on like me:
    • Chairman Powell Press Conference transcript (23 pgs)
    • Press Conference video (45 minutes)

 

• More macroeconomic data this week that seems to set the stage for continued tightening of monetary policy…..
  • BLS JOLT Report released this week showed that job openings actually rose in September to 10.7 million, reversing a downward trend from July and August.
  • The October Jobs Report also came in stronger than expected with an increase of 261,000 (estimate was 205,000) with unemployment rising to 3.7% (estimate was 3.5%) while the labor force participation rate decreased to 62.2%.  Keeping in mind that the unemployment rate and labor force participation rate have shown very little change since early this year.  Notable job gains were in the health care, professional and technical services, and manufacturing sectors.

 

• JPMorgan Chase takes another page from the fintech playbook and launches Story, a property management platform to allow residents to automate rent payments, receive notifications, and view payment history and leas agreements through an online dashboard.  Landlords and renters do not have to be JPM customers to use the platform – scheduled to be released more broadly next year.   

 

• Bend by FNBO (First National Bank of Omaha’s new Credit-as-a-Service solution) and Marqeta team up to launch the Greenlight Family Cash Mastercard® credit card.

 

• Koffie Financial announced the launch of a credit card made specifically for trucking fleets.  The Koffie Card is a Mastercard CC managed by Power, a full-stack CC issuing platform.

 

• Here’s another CU buying a bank…  This time it is Wings Financial Credit Union (Charter 68601; Apple Valley, MN; $8B Total Assets) announced an agreement to acquire Settlers Bank (FDIC 58651; Deforest, WI; $350M Total Assets).
  • If you are keeping track, this makes 11 announced acquisitions of a bank by a CU so far for the year.  This compares to 13 in 2021, 7 in 2020, and 16 in 2019 (Source: FedFis).

 

• Ugh - and the layoffs continue in the FinTech space this week alone:
  • Stripe announced they are cutting about 14% of their workforce, approximately 1,140 employees worldwide, citing challenging economic conditions.
  • Opendoor (online real estate platform) lays off 18% of their workforce, about 550 employees, citing “one of the most challenging real estate markets in 40 years…”
  • Chime also announced they are cutting 12% of staff, about 160 employees, as well as “re-calibrating marketing spend, decreasing the number of contractors, adjusting workspace needs and renegotiating vendor contractors.”
  • Upstart (online personal loan platform)  sheds 7%, about 140 employees, citing a “challenging economy” as well.
  • Lyft also announced job cuts totaling 17% of their workforce.
  • And lastly, CNBC is reporting that Wells Fargo mortgage team braces for layoffs as loan volumes drop.
  • However – not all is gloom and doom as American Banker (behind a paywall so I’m not posting the actual link) is reporting that American Express, Visa, Mastercard, and Discover are all bulking up on hiring with particular emphasis on data science, software, and technology roles.

 

• Now here’s a divestiture that you don’t see every day…..  TIAA entered into a definitive agreement to sell the bank (TIAA, FSB; FDIC 34775; $37.6B Total Assets) in order to “refocus on the company’s retirement business and Nuveen, its asset manager."

 

• The Huntington National Bank (Nasdaq: HBAN; FDIC 6560; $179B Total Assets) selects LiquidX to scale the bank's trade finance infrastructure.  This is exciting to me as Uncle Sean is an old ‘Credit Risk Superfreak’ in the world of trade finance / vendor finance / and supply chain finance solutions.  Woot-woot!!!

 

• Just in case you missed it – the Treasury Department sold a record $979M of I Bonds before the repricing deadline last Friday - nearly as much in one day as they did during three years from 2018 to 2020.  WOWZA!!!!

 

• Notable FinTech funding for the week:
  • Lama AI (AI based business lending platform for FI’s as well as embedded lending for fintech / SMBs) raised $9M in Seed funding.
  • Fursure (mobile banking, pet insurance, and rewards platform for pet owners) raised  $3M in Seed funding
  • Onward (co-parenting money management app) raised $9.7M in Series A funding round.
  • Arta (digital family office / alt investing platform) raised $90M in capital and emerged from stealth.
  • Zest AI (automated underwriting platform) raised $50M in growth capital.

 
 
Random Uncle Sean Stuff:

• The Houston Astros tied the 7 game World Series at 2-2 with a no-hitter on Wednesday night against the Philadelphia Phillies.  Thursday brought another nail biter as Houston held on for a 3-2 victory and now leads the series 3 to 2 with the final 2 games slated for Saturday and Sunday in Houston.  GO STROS!!!!

• Well, ole Elon Musk temporarily closed Twitter offices and told employees to stay home out of “safety concerns” after letting them know they will be informed by email later in the day whether they are being laid off…..
  • Okay – WHAT A JACKASS – yeah, I said that…  C’mon man!  There is no need to publicly humiliate your staff (with immense national media coverage) and invite this much unnecessary stress and anxiety for folks that were sent home to wait and see if they get the bad email or not.  I guess there is no easy way to do this, but it sure feels like it could have been handled in a much more respectful way.  For a super intelligent dude, it sure seems like his emotional IQ is severely lacking at times.  But I’m sure my unsolicited opinion doesn’t cause him to lose any sleep at all – LOL!

• And a big shout out to Jeremy Neuharth with Sycorr for providing me plenty of Dad Joke material at our conference – he was handing these out and of course Uncle Sean could not resist:
  • How does cereal pay its bills?  With Chex.
  • What do you call a dead Magician?  An abracadaver…
  • How do you make a water bed bouncier?  Add spring water!  😝
  • What’s Forrest Gump’s password?  1forrest1

 
 
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!!!
 
Looking forward to our FedFis Roundup conference next week – it’s the largest gathering of BaaS Sponsor Banks EVER – and always free for bankers because of our AWESOME sponsors!  But first, here is the Uncle Sean Update for 10/28/22:
 

• Hey – have you heard of this thing called BaaS???  LOL!!!  Well, the Office of the Comptroller of the Currency announced it will establish an Office of Financial Technology early next year to bolster the agency’s expertise and ability to adapt to a rapidly changing banking landscape.
  • “Financial technology is changing rapidly and bank-fintech partnerships are likely to continue growing in number and complexity. To ensure that the federal banking system is safe, sound, and fair today and well into the future, we need to have a deep understanding of financial technology and the financial technology landscape,” said Acting Comptroller of the Currency Michael J. Hsu. “The establishment of this office will enable us to be more agile and to promote responsible innovation, consistent with our mission.”

 

• Holy Cow – the Connected BaaS / Middleware space really made headlines this week with many new offerings.  No wonder the OCC is looking at this closely (and indeed they should):
  • Marqeta makes a move from modern card issuing to full Connected BaaS / embedded finance offering by announcing product expansion called Marqeta for Banking.
    • In addition to Marqeta’s card issuing, the Marqeta for Banking platform now includes:  Demand Deposit (DDA) Accounts, Direct Deposit and Early Pay, ACH with Plaid integration, Cash Loads and Fee-Free ATMs, Bill Pay, and Instant Funding.
  • Synctera expands their Connected BaaS offering by announcing Synctera Smart Charge Card and Synctera White Label Banking App less than two months after the launch of Synctera Line of Credit.
  • Now this is very interesting and gets deep really quick…  Adyen (foreign bank and global payments conglomerate) launches embedded financial products in the US and Europe called Capital and Accounts.  This is intriguing to Uncle Sean, so let’s dig a little bit deeper (I completely geek out here so feel free to scroll down – LOL):  😊
    • A domestic US Branch of a Foreign Bank launching BaaS / white labeled embedded finance solutions probably should get a little more attention.  How did we get here?  Well, I’m glad you asked – LOL:
      • Adyen received their European banking license back in June 2017.  Subsequently, in May of 2021, Adyen obtained OCC approval as a Foreign Bank Branch enabling them to offer checking, loans, and card issuance (as a domestic branch of a foreign bank).  This specifically geared towards business accounts as there are restrictive regs surrounding retail domestic deposit-taking activities from a foreign bank branch in the US.
    • HOWEVER, keep in mind that the Adyen Account aspect is not an FDIC insured account.  Reference the footnote disclosure #4:
      • “Accounts in the U.S. are issued by Adyen N.V., San Francisco Branch. Adyen N.V., San Francisco Branch is not a member FDIC. Monies deposited in an Adyen Bank Account in the United States are not FDIC insured, are not guaranteed by Adyen and may result in the loss of the principal amount.”

 

• Cross River (fintech infrastructure bank; FDIC 58410) announced expanded card issuing with American Express allowing Cross River to issue credit cards on behalf of fintech companies on the American Express network.

 

• In a continuing sign of the times…..  Boost Mobile (yes, the wireless telecom carrier) announced their new embedded finance / banking service called OmniMoney.
  • OmniMoney by Boost Mobile provides a mobile app, Visa prepaid GPR debit card (issued by Community Federal Savings Bank with Alviere as Program Manager), along with Mobile Check Deposit, and money transfer (including cross-border remittances to Mexico).

 

• Yep - ya knew it was coming – savings deposit rates are starting to increase substantially.  Take a look at Upgrade’s (alt lending platform) new Premier Savings account that launched this week sporting a very attractive 3.50% APY with no fees and no cap (minimum deposit required of $1,000).  CNBC has a good article that also shows LendingClub Bank (fka Radius Bank) advertising the 2nd highest high-yield savings at 3.12% APY with no fees and no cap.
  • Not lost on Uncle Sean is the fact that these two institutions have very similar beginnings.  In fact, the co-founder and CEO of Upgrade, Mr. Renaud Laplanche, was also the co-founder and CEO of LendingClub from 2006-2016 prior to starting Upgrade.

 

• Blockchain.com announced the debut of their Blockchain.com Visa® Card with a waitlist for US customers.  The Visa debit card is issued by Pathward N.A. (fka MetaBank), powered by Marqeta, and allows you to spend crypto or cash without fees and earn 1% back in crypto.

 

• Greenlight (teen / family PFM banking app) launched Greenlight Family Cash Mastercard® credit card (issued by First National Bank of Omaha and powered by Marqeta) with unlimited 3% cash back rewards that can be invested in stocks and ETF’s.

 

• Anchorage (OCC chartered qualified crypto custodian) announced Build With Anchorage.  A full-stack API-enabled crypto infrastructure platform facilitating crypto payment gateways, structured financial products, and crypto investing for fintechs, businesses, and financial institutions.
  • Yep – I guess you could now refer to Anchorage as a “Connected CaaS (crypto-as-a-service) Sponsor Custodian”….  😲  That’s cool!

 

• Amazon announced that it will begin offering Venmo as a payment option at checkout.  When paying with Venmo on Amazon, customers can use their parked Venmo balance, a linked bank account, or eligible debit card to complete the payment at checkout.  Amazon plans to have the Venmo payment option available to all US customers by Black Friday.

 

• Notable FinTech funding for the week:
  • Neural Payments (P2P solution and intelligent secure payments ecosystem for financial institutions) raised $8M in Series A funding round.  Some really good folks over there - check them out at neuralpayments.com.
  • Finexio (B2B A/P Payments-as-a-Service) raised $35M in Series B funding.
  • Merge (unified API for HR integrations) raised $55M in Series B funding round.
  • ConnexPay (connected payments ecosystem, making and receiving payments in one platform) raised $110M in growth equity financing to drive international expansion and enhance their innovative payments platform.
  • Bilt Rewards (co-branded card and rental rewards platform) $150M in growth equity round pushing the valuation to $1.5B.

 
 
Random Uncle Sean Stuff:

• Congrats to the Houston Astros and the Philadelphia Phillies for making it to the 2022 MLB World Series – Game 1 begins tonight on FOX!!!  GO ‘STROS!!!!
• The deal is done.  Elon Musk now owns Twitter.  So, REMEMBER – if you own a Tesla, don’t tweet anything bad about @elonmusk or your car “magically” might not start – LMAO!!!!!
• Don’t forget that Monday is Halloween!  It is one of Uncle Sean’s favorite Holidays (ranks right up there with Thanksgiving and just behind Christmas and Independence Day).  We generally have a ton of trick-or-treater’s so me and Aunt Patty will set up a table and chairs right in the middle of the driveway and sit outside for hours handing out candy.  We have tiki torches, several buckets full of candy, and Halloween theme music in the background (and a discrete adult beverage or two to share with some of our neighbors).  Covid really slowed things down, but last year was great and we are hoping for an even bigger turnout this year!    
• Of course Uncle Sean has to finish this week with some spooky / goofy themed Dad Jokes as we close out October:
  • Mummies don’t like to take time off because it is not safe for them to unwind…
  • Zombies prefer finger food as an appetizer…
  • Always hire “ghostwriters” to write jokes about Halloween (see what I did there – LOL)!!!  😊
  • If you teach a wolf to meditate, then that wolf becomes aware wolf….  Aunt Patty rolled her eyes at that one – to which I naturally interpreted as a nod of approval!  HAHAHA!!!
    • Speaking of Aunt Patty….  I told her that I thought I saw a cockroach in the kitchen so I cleaned and scrubbed everything really well….  The next day I overheard her telling her sister that she was going to put that cockroach in the bathroom next.  Ahhh - touché Aunt Patty, touché - LOL!!!!!  😝

 
 
Have a GREAT weekend, please stay safe, and have a HAPPY HALLOWEEN!!!
 
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!!!
 
Finally got a little rain and some cooler temperatures here in Texas this week – and just like that, everyone in the entire state is busy making chili! 😊  Here is the Uncle Sean Update for 10/21/22:
 

• MOCA is making headlines again this week by partnering with Montgomery County Child Protective Services and offering MOCA’s youth/teen card to children in the foster care system.  MOCA’s card platform ensures safe and secure access to funds with highly advanced controls making sure that the child receives and uses the card for the correct purposes.  GREAT WORK MOCA!!!!

 

• Data Center Inc. (DCI) announced that Tipton Latham Bank has selected DCI as their new core processor (iCore360® cloud-based core) as well as the iCoreGO® digital suite.  Check them out at datacenterinc.com – some really good people doing really good things for community banks!

 

• And so it begins…  JPMorgan Chase announces early access to direct deposit for some customers as they hope to attract more users to a no-overdraft checking account.  This is clearly a calculated response to fintech pressures which really have been an overall positive for consumers; and even the biggest of banks are now having to concede once lucrative fee income (OD/NSF) and ACH risk on payroll files.

 

• Super (fka Snapcommerce) announced the launch of SuperCash, a credit builder / cash back Mastercard secured charge card issued by MRV Banks with hefty cash back rewards – up to 10% on select transactions.

 

• Propel announced a five-year agreement with Pathward, N.A. (fka MetaBank) to be Pathward’s primary consumer lending-as-a-service partner.

 

• Fiserv (Nasdaq: FISV) and IncumbentFI partner together to enable FI's and FinTech's to empower cardholders with programmable payments.  Basically allows the cardholder to link multiple funding sources (DDA, HSA, rewards, crypto, LOC, etc.) to a single card and prioritize funding based on type of transaction.  Also allows the cardholder a set amount of time post-purchase to designate which funding source to settle against. 
  • Bangor Savings Bank is currently rolling out programmable payments to introduce microlending as a funding source / solution to replace overdraft.

 

• Jack Henry (Nasdaq: JKHY) along with Mastercard and Finicity announced an agreement where Banks and CUs can offer their accountholders the ability to see all of their financial accounts (both within and outside of the primary financial institution) in one place solving for financial fragmentation.

 

• Apto Payments (card issuing platform) announced the addition of Patriot Bank as a new bank partner.

 

• Treasury Prime (BaaS Sponsor / Connector) adds First Internet Bank as a new sponsor bank.

 

• FIS (NYSE: FIS) announced the appointment of Stephanie L. Ferris as President and CEO effective January 1, 2023.  Ferris takes over from Gary A. Norcross who will now assume the duties of Executive Chairman of the Board.

 

• Hmmm – so this happened.  Green Dot Corporation (NYSE: GDOT) names George Gresham as President and CEO succeeding Dan R. Henry who was terminated.

 

• And more CEO changes - CEO of GloriFi resigns after some rather less than flattering reporting from The Wall Street Journal.

 

• Ahh, the old Credit / Financial Risk Management superfreak in me just can’t let this go…  To my Ag Banker friends (actually all bankers as this potentially has far reaching implications), especially Chief Credit Officers and Portfolio Managers – I know y’all are all over this, but keep a close eye on the Mississippi River flow / drought concerns as sections of the Mississippi River approach low water levels not seen in more than three decades; and has the potential to impact a very wide range of counterparty exposures.  This Illinois Farm Policy News article on Mississippi River Flow Concerns is worth a quick read as it highlights concerns over disrupted agriculture supply lanes and water levels are projected to drop even further – forcing alternative transportation to railway and trucking with the result of skyrocketing commodity pricing in an already high inflationary environment.
  • Take a quick look at this American Farm Bureau Federation report highlighting supply chain slowdown / interruptions on the Mississippi River for more detail on the financial impacts of grain barge movements with exponential increases in cost per ton due to backlog and reductions in volume requirements.  DANG!!!  😲
  • Here are some timeline / satellite images from space showing drastic changes over just the last three months.
    • Keep in mind that Food and Agriculture Sector is one of 16 critical infrastructures for the United States…

 

• Notable FinTech funding for the week:
  • Mercantile (custom branded credit card platform for SMB’s) raised $22M in capital including $15M in Series A.  The Mercantile Mastercard credit card is issued by Hatch Bank.
  • Ualett (receivable advance for gig / independent contractors) secured a $50M credit facility to continue US expansion.
  • Landis (proptech offering customers an all cash purchase with customer rent option for up to 2 years) raised $40M in Series B funding round.
  • Banyan (automated expense mgmt. platform) raised $43M in Series A funding round.
  • Credit Key (BNPL) raised $115M in Capital including a $100M debt facility and $15M in equity financing.
  • Sezzle (BNPL) signed a new $100M credit facility.
  • TripActions (corporate travel, card, and expense mgmt. platform) raised $304M in Series G with a valuation of $9.2B.

 
 
Random Uncle Sean Stuff:

• Apparently, we are only 2 more UK Prime Minister's away from Christmas!  LOL!!!  Sorry – I guess that was rather “cheeky” of me… 😝
• Hey - here is some unexpected positive news….  Due to our crazy inflationary environment, the IRS announced tax inflation adjustments for 2023 tax year with the big news being about a 7% increase in the standard deduction; and an increase in tax brackets of about 7% across the board. 
• Okay, so I ran across some good ole Chuck Norris jokes this week and laughed way too hard…  I know they have been around for years, but these are too good not to share – here are  a few of my favorites:
  • Chuck Norris can blow bubbles with beef jerky.
  • Chuck Norris can gargle peanut butter.
  • Chuck Norris can kill two stones with one bird.
  • Chuck Norris can lead a horse to water AND make it drink.
  • Chuck Norris can divide by zero (Uncle Sean loves that one - #DIV/0! for the Excel Warriors out there – you know who you are!).
  • Chuck Norris can kickstart a car.
  • Chuck Norris makes onions cry.
  • And lastly…..  Covid has to get Chuck Norris booster shots.

 
 
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!!!
 
Trying to get this week’s Update out early as there is a REHEARSAL DINNER and FAMILY WEDDING we need to get to – CONGRATS to Tanner Mayo and Bre Berich for your upcoming nuptial celebration - WOOOHOOOO!!!!  And now, here is the Uncle Sean Update for 10/14/22:
 

• Bankers Helping Bankers is at it again announcing a Partnership with Trust Exchange to offer a secure and scalable vendor management platform to community banks!
  • "Bankers Helping Bankers was built on the premise that it should be easier for bankers to find their ideal technology partners," said IBAT President and CEO Christopher Williston VI. CAE. "Finding good partners is just half the battle. We believe that giving community bankers a network-enabled solution for maintaining and monitoring their third-party vendor relationships is an essential next step in our delivery of value."

 

• Michael Hsu, Acting Comptroller of the Currency, in an interview with Reuters explained that his caution over banks partnering with fintechs is not meant to stifle those arrangements, but rather reflects his concern that firms must adequately gauge their risks.  "Look, bank-fintech partnerships, they're here to stay. I'm not trying to do away with them," Hsu said on Wednesday. "This is the future, so let's do the future right."  To which Uncle Sean says “HELL YES!!!!”  LOL!
  • Hsu went on to explain that his concern over banks and fintechs joining forces is the possibility that responsibilities for monitoring risk can become muddied when multiple firms, sometimes with different incentives, share responsibilities.
    • Yessir – Uncle Sean believes that Hsu is referring directly to potential compliance concerns in the middleware / connector space….  And I completely agree. 😊

 

• Speaking of…  The OCC released their Bank Supervision Operating Plan for 2023.  No surprise to anyone that third-party risks including cybersecurity and fintech are a major emphasis (compliance anyone?) – and climate related financial risks (particularly for large banks) makes the list.  You can read the 4 page doc here.

 

• Check this out - The Apple ecosystem continues to evolve deeper into consumer finance.  This week Apple announced a new savings account for Apple Card that allows users to save their daily cash rewards in a high-yield savings account from Goldman Sachs.  Now this is starting to get pretty cool:
  • It is worth noting that this account is NOT closed to just Apple CC cash rewards – “users can also deposit additional funds into their Savings account through a linked bank account…”
  • Actual Yield has not been disclosed, but Marcus by Goldman Sachs is offering 2.35% APY for their online savings account at the time I am writing this.
    • Hmmm…  1-3% daily cash back plus 2.35% yield, and I don’t have to do anything….   Starting to look pretty compelling to Uncle Sean!

 

• Any press is good press, right???  Well – except for this PayPal blunder over the weekend.  PayPal had initially released an updated AUP stating they would unilaterally fine users $2,500 for spreading “misinformation.”  However, after significant backlash and criticism, PayPal issued a statement stating the AUP update had gone out in error and was a mistake….  Mhmm…

 

• Edward Jones withdraws their ILC bank charter application citing “the current environment” and “recent conversations” with the Federal Deposit Insurance Corp. (FDIC) as its reasons for abandoning the effort.

 

• Brex (corporate card and spend management platform) laid off 11% of their workforce; and their CFO, Adam Swiecicki is leaving to join Rippling (business workforce and spend management platform).  This follows a June announcement from Brex to pivot away from startups to focus on more established SME’s.

 

• The Wall Street Journal is reporting that NYDIG laid off about 1/3rd of its workforce last month and a reshuffling of the C-suite despite stating the balance sheet is the strongest it’s ever been.

 

• Andrei Cherny, the CEO and cofounder of fintech company Aspiration, is stepping down.  Aspiration also announced Olivia Albrecht as the new CEO.

 

• Meanwhile, the Social Security Administration announced an 8.7% Benefit Increase for 2023 due to persistent inflationary pressures.  Also known as cost-of-living adjustment (COLA), this follows a 5.9% increase last year and is the highest increase in 40 years.  😲

 

• Google selects Coinbase to take cloud payments with crypto in early 2023.

 

• BankiFi (business banking solution for FI’s) signs Axiom Bank to enable Axiom’s SMB customers to better track and manage their business finances using BankiFi’s Open Cash Management platform.

 

• WOW – guessing that fintech funding has NOT dried up as this week was BUSY…  Notable FinTech funding for the week:
  • Step (teen credit builder) raised $300M in debt funding to build out their platform including crypto-investing starting with bitcoin and expanding to stocks and other cryptocurrencies soon.  Step also unveiled Step Money 101, an easy to use financial literacy (finlit) program for young adults.
  • Airwallex (cross-border business banking) raised $100M in Series E-2 extension round at the same $5.5B valuation following the first $100M extension in Nov 2021 after the original $200M Series E in Sep 2021.
  • OatFi (API enabled / embedded working capital infrastructure for B2B payments) raised $58M in Capital consisting of $8M in equity and $50M in debt financing.  As an old credit and sales finance guy, Uncle Sean finds this API-powered business credit stack very interesting - check them out at oatfi.com.
  • Moon Mortgage (crypto as collateral lending platform) raised a $3.5M Seed Round to fund their Crypto Mortgage loan product with custody services provided by Anchorage Digital.
  • Arro (alt credit platform to provide access to low-interest credit through a gamified app) raised $10M Seed Round.
  • Nickels (white-label FI product to help customers manage their finances ) raised $4M in Seed funding.
  • Northstar (financial wellness / PFM platform) raised $24.4M in new capital with the mission to bring financial guidance as a universal employee benefit.  Valuation was not disclosed, but this TechCrunch article references a significant up-round; and 5X YoY revenue growth.
  • GoHenry (US and UK provider of prepaid GPR debit card and app for kids) raised $55M in capital to continue European expansion.
  • Astra (embedded payments platform for FI’s, fintech’s, and enterprises) raised $10M in Series A funding round.
  • NorthOne (neo business bank) raised $67M in Series B funding round.  Valuation was not disclosed, but the company did state that revenue grew “4-5x” over the last 12 months while customer growth was “in line with revenue growth.”

 
 
Random Uncle Sean Stuff:

• HOLY COW – allergy season in the Texas Hill Country is not for the faint of heart!!!!  RAGWEED is an absolute killer - UGH!!!!  Allergies are so bad right now that local drug dealers are busy converting Meth back into Sudafed!!!  LOL  😝
• Before I hightail it out of here to celebrate Tanner and Bre’s wedding, Uncle Sean has to lay down some Dad Jokes:
  • Does anyone else set their alarm extra early to make sure you have enough time to lay in bed and be angry about having to get up…???
  • You know when you buy a bag of salad and it gets all soggy and brown?  Well, cookies don’t do that…
  • Good puns make me numb, but math puns make me…. number… 
    • Oh C’MON – you know that was a good one!!!!  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 Friday!!!
 
Here is the Uncle Sean Update for 10/7/22:
 

• Bankers Helping Bankers (BHB) is at it again!!!!  Check out the newest as BHB launches "Test Pilots", a way for community banks to join as innovative bankers to test pilot early-stage fintech vendor products and services.  The Test Pilot banks will become strategic partners with the fintech vendor, providing:
  • Beta testing of products/services including feedback
  • Influence of product development
  • Assisting in a rollout strategy that minimizes risk to both the bank and the fintech (of huge importance)
    • Responsible innovation for the benefit of community banks – HELL YES!!!!  Banks can sign up here for BHB Test Pilots.

 

• Macro-economic news – Jobs Data is still strong at +263,000 for Sept but slowing (and the smallest since Apr 2021) and unemployment dropped to 3.5% (forecast was 3.7%).  CNBC has a good summary.
  • However, Uncle Sean finds it somewhat interesting that the Labor Force Participation Rate ticked down slightly for Sept to 62.3; and is trending mostly flat for the year and still well below pre-pandemic levels.  Meanwhile wages are still running 5% year-over-year.
  • Keep in mind that the next FOMC meeting isn’t until Nov 1-2.

 

• MOCA Financial announced they have partnered with the Association of Military Banks of America (AMBA) to launch the PATRIOT card for Veterans via MOCA’s next-gen card-based payment platform.  The PATRIOT card allows our Veterans the ability to have their government benefits deposited directly to a card without the need for a bank account. 
  • “Veterans will benefit greatly from MOCA’s virtual and physical cards with associated technology that empowers cardholders to self-issue cards on-demand, including cards to family members; get real-time transaction alerts; and even make Person to Person (P2P) payments to family members or others in real-time. In addition, our Veterans can add money to their MOCA Cards from multiple sources, transfer money between cards, provision their cards to a digital wallet with the click of a button, and immediately replace a lost or stolen card.”

 

• Q2 (NYSE: QTWO, Q2 Holdings, Inc.) announced the acquisition of Sensibill as a compliment to Q2 Catalyst commercial suite by helping small and medium sized businesses to automate and streamline expense management via Sensibill’s machine learning platform.

 

• Rapid Finance announced the acquisition of Thrive.

 

• Saint Louis Bank (FDIC 58018; $712M Total Assets) announced a partnership with Nymbus to build out a niche digital banking solution (i.e. direct digital bank) for small to medium-sized law firms and other members of the legal community.

 

• New BNPL regs and enforcement seem to be coming as the Federal Trade Commission (FTC) weighs in on BNPL following a similar deep dive last month from the CFPB.  Payments Dive has a good summary.

 

• Afterpay (BNPL) announces interest bearing monthly installment plan for 6 – 12 months for purchases between $400 and $4,000.
  • Interesting side note from Uncle Sean:
    • Afterpay was acquired by Block (Square) for $29B and this deal was completed January 31, 2022.  Additionally, Square obtained a bank charter and began banking operations back in March 2021 as Square Financial Services (FDIC 59177).
    • However, Square (Block) is using First Electronic Bank (FDIC 35533) as the program sponsor for Afterpay’s new monthly installment plan.
      • To be honest, I am not entirely sure why Square is not running the installment loans through their own bank charter.  If I had to speculate, it may have something to do with: 1) BNPL regulatory scrutiny, 2) Square may feel that they are not ready for that much loan/underwriting exposure (through the charter), or 3) it just may be too far of a pivot from their regulatory approved de novo business plan.  But probably a combination of all of the above.

 

• Just in case you missed it, the NCUA has been busy….
  • Late last week the NCUA liquidated Paducah Teachers Federal Credit Union (Charter 11955; $12M Total Assets).  FedFis had a Failure Rating of 4.75 (1.00 – 5.00 scale with 5.00 being the worst) for Paducah Teachers FCU for 2Q22 Call Report placing them in the lowest possible percentile of all CU’s.
    • Yeah – we do Bank and CU Ratings too (nice plug, right)!  😊
  • And this week, the NCUA placed Mingo County Education Federal Credit Union (Charter 22678; $2.7M Total Assets) and O.F. Toalston Federal Credit Union (Charter 6293; $479K Total Assets) into conservatorship – both for unsafe and unsound practices.

 

• And another crypto cross-chain bridge hack…  This time it was Binance’s BNB token hacked for about $570M via cross-chain bridge hack – although the majority of funds remain under control in the exploiter’s crypto wallet and about $100 million was “unrecovered.”

 

• Notable FinTech funding for the week:
  • Tally (automated consumer credit card debt payoff service) raised $80M in Series D funding round.
  • Equi (alt-investing platform) raised $15M in Series A.
  • Railsr (fka Railsbank) raised $46M in Capital consisting of $26M in Series C and $20M in debt financing.
  • Juno (crypto digital banking firm) raised $18M in Series A funding round and launches a loyalty token.
  • Jiko (a division of Mid-Central National Bank) raised $40M in Series B funding round.

 
 
Random Uncle Sean Stuff:

• We said goodbye to the original Coal Miner’s Daughter and Country Music legend Loretta Lynn who passed away peacefully at her home this week at the age of 90.
• This is a true story – I was interviewing at KHS America with Mr. Keith Gard many years ago for a Controller position overseeing consolidated financial reporting, treasury, credit, FP&A, payroll, and HR.  Keith asked if I had any experience with HR to which I jokingly replied, “yeah – I was in their offices all the time at my last job.”  Fortunately, Keith shared my sense of humor and I actually did get that job.  LOL!!!!!
• Now let’s crank out some classic Dad Jokes!!!
  • I wonder if Mr. Peanut ever said, “I’ll be back in a Jiff.”
  • Who knew that Breaking Bad was not about break dancing at all…???
  • I told Aunt Patty that the kids have been on eBay all day.  If they are still on there tomorrow, I’m gonna lower the price.  😝
  • And of course a motivational post….  “THINK – it's what you do when you can’t thwim…”

 
 
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!!!
 
WOW – I can’t believe we are heading into the 4th quarter of the year already!  Also, can someone PLEASE tell the stock market to quit day drinking during the week???  Don’t forget to sign up here to have the Uncle Sean Update delivered straight to your inbox.  Here is the Uncle Sean Update for 9/30/22:
 

• A BIG HIGH FIVE to our friends at Fitech by Deluxe as a Premier Sponsor to the Bankers Helping Bankers platform (BHB) furthering BHB’s mission of empowering community banks through data and facts!!!  These quotes say it all:
  • “The accessibility of data and connectivity made possible by Bankers Helping Bankers underscores Fitech’s efforts to identify products that drive earnings and diversify sources of income to help insulate FIs from emerging fintechs,” said Rian Clinton, Director of Sales at Fitech by Deluxe.
  • “We are proud to be a trusted partner of financial institutions across Texas and the country, and we are proud to support Bankers Helping Bankers as they connect FIs with access to industry opportunities,” said Matt Mingenback, President of Fitech by Deluxe. “Together, we will help financial institutions compete and thrive as they adapt to evolving industry trends.”
  • BOOYAH!!!!!  😊

 

• Treasury Prime (BaaS enabled platform / BaaS Connector) continues to make headlines – this week they announce a partnership with Bangor Savings Bank (FDIC 18408; Total Assets $7B) to enable embedded finance / BaaS offerings to the bank and the companies it partners with in the financial services industry.

 

• Battle Bank (proposed de novo digital first bank in organization) has selected Savana (financial software for banks and fintech companies) “to automate processes between the core products and customer channels.”  Battle Bank will also be using Savana’s newly launched online and mobile digital banking experience for consumer banking, business banking and account opening.
  • This comes on the heels of a $45M Capital Raise last month to accelerate Savana’s core agnostic, customer-centric banking operations through their Digital Delivery Platform.  Check them out at savanainc.com – pretty cool!

 

• Quaint Oak Bank (FDIC 35497; Total Assets $752M) selects Teslar Software to enhance the banks commercial lending strategy by digitizing the entire end-to-end lending process.
  • Uncle Sean is keeping an eye on Quaint Oak Bank as I am hearing great things to come…!!!!

 

• The PNC Financial Services Group, Inc. (NYSE: PNC; BHC for PNC Bank, NA – FDIC 6384; Total Assets $534B) acquired Linga, a cloud-based restaurant operating system providing POS and payments solutions and more.

 

• Additionally, PNC Bank announced a partnership with Blend to digitally optimize the company's end-to-end online mortgage application process.  Basically making it easier for a customer to apply for a mortgage and import bank and payroll information directly into the application portal.

 

• Chase and DoorDash announced plans to launch the DoorDash Rewards Mastercard credit card.  Also worth noting, Goldman Sachs is reportedly (although no official announcement yet) launching a T-Mobile credit card.
  • This comes just a few weeks after a JPMorgan note to investors showing Goldman Sachs loss rate on cc loans of 2.93% for 2Q being the worst among big US card issuers and “well above subprime lenders.”
    • Hmmm - bad blood brewing….???  😲

 

• And this is interesting…  Nexo (crypto lender) has reportedly acquired an undisclosed stake in Hulett Bancorp, the bank holding company that owns Summit National Bank (FDIC 25054; Total Assets $96M), an OCC chartered bank.  The press release states that Nexo intends to offer “bank accounts, asset-backed loans, card programs, as well as escrow and custodial solutions through Summit National Bank.”
  • Also announced this week, eight states file cease-and-desist orders against Nexo for allegedly offering interest-earning accounts without registering them as securities by “allowing investors to deposit assets with Nexo in exchange for earning yields as high as 36% on their deposits.”  Sound familiar, anyone….???
  • Something tells me we haven’t heard the last of this story from the SEC, the OCC, and States.  Mhmm…..

 

• FTX US wins the auction to acquire Voyager Digital, the bankrupt crypto brokerage, subject to approval by the U.S. bankruptcy court on October 19th.  FTX US’s winning $1.422B bid was comprised of approximately $1.311B worth of fair market value of Voyager’s current crypto holdings plus $111M in incremental valuation. 

 

• IBAT joins the U.S. Chamber of Commerce and many other co-plaintiffs in suing the CFPB for overreach of authority.

 

• More CFPB news as they sue MoneyLion for allegedly violating the Military Lending Act by charging in excess of the 36% cap on loans to servicemembers and their dependents “through a combination of stated interest rates and monthly membership fees.”

 

• Rho (neo business bank) announced the development of Prime Treasury – a tailored treasury management platform targeting businesses with over $5M in liquid assets (they have other treasury solutions available for those with less than $5M).  Uncle Sean gives a nod to great timing as the bond market and treasury rates have made a screaming comeback recently.  Good stuff!!!

 

• FinTech funding news did slow down a little this week.  We shall see if this is an anomaly or the beginning of a trend.  Notable FinTech funding for the week:
  • Tactic (crypto accounting software for businesses) raised $11M in capital
  • Strike (bitcoin payment app for consumers and merchants) raised $80M in Series B funding round.
  • Noble (embedded no-code credit solutions) emerged from stealth and announced $15M in Series A funding – check them out at benoble.io.
  • Inclined (digitized platform for loans against existing whole life insurance) $15M in Series A funding round.
  • Bridge Money (mobile app offering supplemental income via cashback, surveys, ad viewing, etc.) raised $5.8M in Seed to continue development including more in-app money making opportunities.

 
 
Random Uncle Sean Stuff:

• I am cutting out a early today (don’t tell my boss) for some weekend shenanigans, so I am keeping this short – but I would be neglecting my duty if I didn’t lay some Dad Joke wisdom down:
  • I hate it when you try to leave work a little early on Friday and the Boss reminds you it’s actually Monday and only 9AM - DANG!!!
  • Shout out to the folks that can’t find their reading glasses because they are on top of your head – y’all are my people!!!
  • Self-reflection time….  Sometimes Uncle Sean gets road rage walking behind people at the grocery store.  LOL!!!!
  • And lastly…  What did the buffalo say to his boy when he sent him off to college?  Bison…. 😝

 
 
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 Fall Y’all – which means it only got to 100 degrees this week in Austin, Texas!  Here is the Uncle Sean Update for 9/23/22:
 

• Shout out to MOCA Financial for being the latest to join the BHB BaaS Association!!!!   The BHB BaaS Association was created with the purpose of promoting, creating, and supporting Banking-as-a-Service (BaaS) and is aimed at serving the unique needs of BaaS sponsor banks in a responsible compliant way – furthering the cause of Bankers Helping Bankers.  I love it!!!! 😊

 

• It’s Fed Week!!!  As widely expected (except by the stock market apparently – YIKES), the FOMC unanimously voted to raise rates by 75 bps again with a new target range of 3.00% - 3.25%.  Additionally, the Fed will continue to reduce the Balance Sheet by $95B per month in Treasuries and agency backed MBS as detailed in May.  CNBC has a good summary as always.
  • The FOMC also released their Summary of Economic Projections (SEP) / “dot plot” (first since June) – just a reminder from Uncle Sean that although media outlets are fascinated by this, it is not policy or a plan of action, but simply a median of current assumptions based on current economic data as it stands today.  Key points:
    • Fed Funds rate projection of 4.4% by end of this year; and 4.6% for 2023
    • Median Unemployment forecasted to hit 4.4% for 2023 - 2024
  • Some quick Uncle Sean ‘Off the Rails’ commentary:
    • Finally exiting about a 15 year period of highly compressed NIM (basically if you are under 40 you probably haven’t seen this before as a working adult).  It will be interesting to see if we begin to see an uptick in De Novo applications as rate spread become attractive.  Conversely, as interest rates and unemployment start to heat up, Uncle Sean will be watching to see if credit issues begin to enter the picture as corporations will be looking closely at profits and potentially curtailing capex / expansion plans.  We are already seeing a slow-down in the housing sector.  But the good news here is that bankers are AWESOME at this.
      • For my Portfolio / Credit Manager / Chief Credit Officer friends…  Regarding exposures for your customers - I am still reading about potential exposure gaps in business inventory insurance (both cargo/transit and in-house) as supply chain issues continue to lead into inventory buildup.  Also commercial and residential property insurance limits as RE valuations have swelled over the last few years.

 

• The Bancorp Bank, N.A. (leading BaaS Sponsor Bank; FDIC 35444; BHC is public under the symbol TBBK) has completed their charter conversion with the OCC and is now a nationally chartered financial institution.

 

• Chipper Cash (cross-border payments app) partners with Highnote to launch US-based card program.

 

• Stash (investing and fintech banking app) announced an upgrade to their fintech banking platform including infrastructure and ledgering dubbed Stash Core (more on that below); and a shift in their patented Stock-Back® Debit Mastercard® which is now issued by Stride Bank (previously a Visa card issued by Green Dot).
  • American Banker (behind a paywall so I’m not providing the link) stated that Stash previously relied on Green Dot for core / ledgering.  Now that Stash has transitioned to Stride, the Stash Core platform is based on:
    • Mambu is powering the ledger
    • Alloy is providing identity decisioning
    • Marqeta for card processing

 

• Nymbus and Citizens Bank of Edmond partner together to launch a new direct digital bank focused on newly enlisted military members and their families with an anticipated launch date of early 2023 – very cool!!!
  • Hmm….  A little bit of backstory maybe???  I seem to recall a press release about a year ago where Moven and Q2 Core Pro were originally set to provide a direct digital banking solution…  I wonder what happened???  😲

 

• Atomic (suite of payroll connectivity API’s) announced a partnership with Aise (financial wellness app with bill pay via payroll deductions for employees).

 

• Banc of California (FDIC 35495; BHC is public under the symbol BANC) acquires Deepstack Technologies for $24M in cash and stock allowing the bank to expand payment processing services.

 

• Treasury Prime (BaaS enabled platform / BaaS Connector) announced that they have been accepted into the Jack Henry Vendor Integration Program further stating that “all banks on the Jack Henry core are able to adopt Treasury Prime’s BaaS technology and immediately offer embedded finance to their fintechs and enterprise clients.”
  • Additionally, Treasury Prime announced a partnership with FB Financial Corp (FirstBank; FDIC 8663; $12B Total Assets) to bring embedded finance offerings to FirstBank’s clients.

 

• Synctera (BaaS enabled platform / BaaS Connector) launched Synctera Line of Credit to enable “both FinTech developers and established companies to quickly create innovative lending products or embed lending services.”  The article goes on to state that “Synctera provides the required financial technology - including ledger and KYC/KYB services - as well as servicing and optional operational and compliance support. A Synctera partner bank will serve as the lender of record.”

 

• Notable FinTech funding for the week:
  • Portabl (identity verification mgmt. / “financial digital passport”) raised $2.5M in Seed funding.
  • Sardine (fraud detection in crypto and fintech) raised $51.5M in Series B funding round.
  • Higlobe (international payments) raised $14M in capital.  Using a monthly subscription fee (as opposed to a per transaction rate), Higlobe utilizes asset-backed stablecoins to provide a means of making cross-border payments between bank accounts.
  • Scratchpay (financing for veterinary and human healthcare) $35M in Series C funding round.
  • DoorLoop (rental property mgmt. software) raised $20M in Series A funding.
  • Future (green / ESG rewards platform including Visa debit card) raised $5.3M Seed Funding.

 
 
Random Uncle Sean Stuff:

• NOOOO!!!!!  Apparently, a truck full of cases of Coors Light beer crashed in Florida.  Fortunately no one was seriously injured, but the pictures immediately made me think of Tanner’s upcoming bachelor party!!!!  YEEE-HAW - LOL!!!
• Seriously???  Do we really need an FDA Warning not to use NyQuil as a chicken marinade???  Thanks TikTok….
• Some quick Dad Jokes to get us into the weekend!!!!
  • If you think about it, cereal is really just breakfast soup….
  • My daughter, Claire, asked if she could go to a 50 Cent concert.  I gave her a dollar and said take your Mom with you.
  • Aunt Patty told me that she read where it takes three sheep to make a wool sweater.  Heck, I didn’t even know they could sew!!!

 
 
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!!!
 
WHOA NELLIE (in my best Keith Jackson voice) – what a busy week!  Here is the Uncle Sean Update for 9/16/22:
 

• With all eyes on ‘Powell & Co.’ for the FOMC meeting next week, August CPI came in hotter than expected at an annual rate of 8.3% with Core CPI at 6.3% (estimate was 8.1% and 6.1% respectively) with increases in shelter, food, and medical care - even as gas prices fell 10.6% from the prior month.  Yep, Uncle Sean is feeling it too; and it sucks!!!!  ☹

 

• Meanwhile, Goldman Sachs credit card business, anchored by the Apple Card and the GM card to a lesser extent, showed loss rate on credit card loans of 2.93% for 2Q.  “That’s the worst among big U.S. card issuers and ‘well above subprime lenders,’ according to a Sept. 6 note from JPMorgan.”  YIKES!!!

 

• No real surprise that the CFPB is looking into Reg E, but American Banker (behind a paywall so I won’t post the actual link) is reporting that CFPB Director Rohit Chopra said in a speech Wednesday that the level of PTP fraud is “frightening” and specifically called out providers such as Zelle, PayPal Venmo, and others – again…  😲

 

• Speaking of….  The CFPB released their comprehensive report on BNPL financing (83 pages) from information obtained by Klarna, Affirm, Afterpay (Block), PayPal, and Zip.
  • Key points – the five biggest BNPL firms issued 180M loans totaling $24B in financing last year.  This is up more than 10x from 16.8M loans in 2019 worth $2B.
  • Look for more regs to come as the agency is considering interpretative guidance and supervisory examinations of BNPL programs.

 

• The White House released the expected Comprehensive Framework for Responsible Development of Digital Assets with an emphasis on risk / regulation, crime, and enforcement actions to protect consumers.

 

• One (Walmart fintech with banking services provided by Coastal Community Bank) will be introducing checking accounts as a beta to thousands of Walmart employees and a small percentage of its online customers in the coming weeks; with plans to make the accounts available to Walmart’s 1.6M employees (WOWZA) within a year before making the services available more broadly.

 

• Adyen becomes the first financial technology platform to launch Cash App Pay outside of the Block ecosystem.  This allows Adyen’s business customers be able to begin accessing Cash App Pay as an integrated payment method for their U.S. customers online shortly and in-store next year. 

 

• Modern Treasury (business payments operations software) partners with Goldman Sachs Transaction Banking (TxB) to provide embedded payments to corporate customers.

 

• JPMorgan Chase to acquire payments fintech Renovite to enhance merchant acquiring revenue.

 

• Grasshopper Bank announced that it has received Preferred Lender Program (PLP) delegated authority status with the U.S. Small Business Administration.

 

• Bolt (one-click online checkout firm) announced the mutual termination of the merger agreement to acquire Wyre (crypto infrastructure payments firm) for $1.5B.  The merger would have produced the industry’s first one-click crypto checkout platform.

 

• ModusBox spins off PortX Inc. as an independent entity with an additional $10M in Series A extension.
  • PortX is “a technology company focused on financial services integration software that unlocks access to banking core data, eliminates vendor dependencies, and enables embedded banking-as-a-service solutions.”

 

• NCR Corporation (NYSE: NCR; enterprise technology provider to banks, retailers and restaurants) announced it will split two independent, publicly traded companies - one focused on digital commerce, the other on ATMs.  Expected to be completed by the end of 2023.  Check out the investor deck detailing:
  • CommerceCo as a leading digital commerce business at the forefront of secular evolution in retail, hospitality, and digital banking industries.
  • ATMCo as the leading global ATM-as-a-Service and ATM network business.

 

• Bottomline acquires Nexus Systems further deepening Bottomline’s business payments reach in the real estate and property management industries.

 

• Citizens Financial Group (NYSE: CFG) announced an agreement to acquire College Raptor, an online college planning platform, to supplement Citizens existing student lending and refinance business.

 

• Wow, here’s some big news in the Investment Banking world - ProBank Austin is being acquired by Forvis (top 10 accounting and advisory firm created by the recent merger between BKD and DHG) effective Oct 1, with the exception of the ProBank Austin Investment Banking Group (led by FI industry veterans Craig Mancinotti and Rick Maroney) which will be joining Hovde Group – also effective Oct 1. 
  • Congratulations are in order for Craig Mancinotti and Rick Maroney who will be Senior Managing Directors in Hovde’s Depository practice.  The additions to the Hovde investment banking team also include Mike Moran, Managing Director, and four additional investment banking professionals.

 

• Marqeta (modern card issuing platform) teams up with Bread Financial (NYSE: BFH) to launch an in-store and online, one-time use virtual card at participating retailers for a frictionless checkout experience.

 

• Mercury launches corporate credit card called IO (Mastercard CC issued by Patriot Bank) to help start-ups scale their business.

 

• KlariVis (enterprise dashboard and analytics solution for financial institutions) continues to see rapid growth and announced a new customer agreement with First Farmers Bank & Trust Co., a $2.5B community bank headquartered in Indiana with additional branch footprint in Illinois.  Check out the KlariVis platform here – looks cool!

 

• Abrigo and Encapture partner together to help financial institutions manage and streamline the commercial loan underwriting process.

 

• Atomic (payroll connectivity) partners with Hydrogen (embeddable fintech infrastructure) to allow Hydrogen customers to integrate Atomic’s feature set for employers, employees, gig-economy workers, and payroll providers.

 

• Notable FinTech funding for the week:
  • Power (fintech infrastructure; a full-stack next-gen credit card issuance platform), led by fintech veterans Randy Fernando (Azlo, Acorns, Vault) and  Andrew Dust (Amount, Acorns) emerged from stealth after raising $316M in capital consisting of a $16.1M Series A and a $300M credit facility. 
    • Power CEO, Randy Fernando told TechCriunch, “My belief is that over the next several years, consumers will go from banking with fintechs to banking with their favorite brands.  That is the vision we are building at Power — building modern fintech to power commerce.”
  • Cledara (SaaS subscription mgmt. platform – includes virtual business credit card as embedded finance solution) raised $20M in Series A funding round to further US expansion.
  • Ratio (embedded BNPL and sales financing for SaaS companies) emerged from stealth and announced $411M in capital consisting of an $11M in venture funding and a $400M credit facility for customer financing.
  • Kafene (point-of-sale lease to own financing option) raised $18M in Series B finding round.
  • Majority (neo immigrant bank) raised $37.5M in capital consisting of $30M in Series B plus another $7.5M in debt financing just nine months from their Series A round.  Valuation was not disclosed but the company stated 5x revenue growth over the past year.
  • SavvyFI (employee benefit program for college savings and student loan payments) raised $4.9M in Series A round.
  • Denim (fka Axle Payments – payment platform for freight and logistics) raised $126M in capital consisting of $26M in Series B and $100M in debt financing.
  • Payall (bank processor for cross-border payments) raised $10M in Seed round led by a16z to enable banks to “compete and win against fintechs.”

 
 
Random Uncle Sean Stuff:

• Special HAPPY BIRTHDAY wishes go out to our very own Mr. Tanner Mayo!!!!  It has been claimed that Tanner was actually born with a full beard…  And rumor has it that if you were to somehow succeed in shaving his beard off, it would spontaneously regenerate overnight!  Chuck Norris told me that he wishes he had ‘beard game’ like Tanner.  Santa Claus has Tanner beard envy.  The real reason Sasquatch hasn’t been photographed is because he is too embarrassed and intimidated to show his face since he saw Tanner’s beard.  HAHAHAHAHA – Happy Birthday buddy – we love you!!!! 😊
• And more Dad Jokes!!!!
  • If newly appointed King Charles III learns to play the guitar, wouldn’t he be the artist formerly known as Prince????
  • Do ranchers buy cows from a cattle log?  Also, if you are dressed like a cowboy you are, in fact, ranch dressing….
  • Why did the chicken join the gym?  To work on his pecks!!! 😝

 
 
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!!!
 
Hmmm - for a short week, it sure felt like there was a lot of policy and regulatory speeches…  Here is the Uncle Sean Update for 9/9/22:
 
Let’s get the reg stuff out of the way first -

• Acting Comptroller of the OCC Michael Hsu gave a speech at the TCH + BPI Annual Conference titled “Safeguarding Trust in Banking: An Update” – with a segment emphasizing “Developing a more sophisticated understanding of bank-fintech arrangements.”
  • Specifically stating, “bank-fintech partnerships have been growing at exponential rates and have gotten more complicated.  Banks and tech firms, in an effort to provide a ‘seamless’ customer experience, are teaming up in ways that make it more difficult for customers, regulators, and the industry to distinguish between where the bank stops and where the tech firm starts.”  Also noting that this is likely to “accelerate and expand until there is a severe problem or even a crisis.”
    • Keeping in mind that this comes one week after the written OCC agreement with Blue Ridge Bank related to third-party fintech partnerships.
  • The BHB BaaS Association responded by issuing a statement, “Acting Comptroller Hsu’s comments at the TCH+BPI Annual Conference shine light on issues which have concerned the members of the Banking as a Service Association for some time.  We believe that BaaS relationships can carry mutual benefit for financial technology companies and financial institutions alike.  However, the only winning scenario for partnership is one in which the end-user is served in a safe, sound and compliant manner” also encouraging collaboration towards clear and consistent regulatory guidelines.

 

• Regarding inflation and monetary policy, the Fed continues its hawkish tone.  Federal Reserve Chair Jerome Powell reiterated this week in a Q&A presented by the Cato Institute that he is “strongly committed” to fighting inflation and will continue “until the job is done.”  And again highlighting, “the longer inflation remains well above target, the greater the risk the public does begin to see higher inflation as the norm, and that has the capacity to raise the costs of getting inflation down” longer term.  Worth noting that this was Chairman Powell’s last scheduled public event before the FOMC meeting on Sep 20-21.
  • Fed Vice Chair Lael Brainard echoed similar resolve during a speech at TCH and BPI 2022 Annual Conference stating, “we are in this for as long as it takes to get inflation down.  So far, we have expeditiously raised the policy rate to the peak of the previous cycle, and the policy rate will need to rise further.”

 

• SEC Chairman Gary Gensler continues to continues to forcefully reiterate the case for SEC’s broad authority over crypto stating the “vast majority” of the nearly 10,000 tokens in the crypto market meet the definition of a security and are therefore subject to securities laws. 

 

• Fed Vice Chair of Supervision Michael Barr gave his first policy speech this week pushing for action on stablecoins, climate change preparations and both the safety and fairness of the finance industry.  You can find the full speech here.

 

• And just in case you missed it, the OCC released their five year Strategic Plan for 2023 - 2027 with a focus on:
  • The ability to be agile and learn quickly
  • Highly credible and consistently trusted
  • Leading on bank supervision as the banking system evolves

 
Now on to the rest of the update -

• Zelle® adoption continues to explode with 2Q 2022 results showcasing:
  • 1,700 banks and CU’s including 100+ MDIs offering Zelle in their apps
  • 2Q 2022 payments totaled $155 billion with 554 million transactions.  YoY $ amount increased by 29% with # of transactions increasing by 27%.
    • Highlighting an increase of 87% quarter-over-quarter for business disbursement transactions to nearly 8 million employees, contractors, and small business customers.
  • 5 year milestone includes 5 billion transactions totaling $1.5 trillion in value have moved across the network since 2017.

 

• WOW - Apple Pay has now moved into the #2 spot edging out Mastercard by processing more than $6 trillion in annual transaction volume behind only Visa at the top spot globally.

 

• DailyPay (on-demand wage platform) announced the launch of Friday a Visa prepaid GPR debit card and mobile app allowing for “no-fee instant on-demand pay transfers” to the debit card.  Users can track the card balance and transaction history on the mobile app, along with the available amount of on-demand earned pay they could draw upon.  More details about Friday by DailyPay:
  • Existing bank account is not required, no minimum balance, no maintenance fees.
  • Currently, the no-fee, instant on-demand pay requires employer participation in DailyPay, and election to deposit early transfers and set direct deposit to the Friday Card.
  • Allows for multiple funding options including:
    • Direct deposit, transfer of available on-demand pay balance, other linked bank account, and cash loading via 90,000+ Green Dot retail locations across the country.

 

• The FDIC released the Second Quarter 2022 Quarterly Banking Profile.  Key takeaway is “generally positive results this quarter, amid continued economic uncertainty.  Loan growth strengthened, net interest income grew, and most asset quality measures improved.  Further, the industry remains well-capitalized and highly liquid.”  More specifics:
  • Net Income declined $6B compared to 2Q 2021 due to increase in provision expense of $21.9B.
  • NIM expanded to 2.80% - YAY!!!!
  • Loan growth is wide and consistent – DOUBLE YAY!!!
  • Credit quality remains in check, but some growth in early past due (30-89) is showing up in consumer loans (also note increase in provision mentioned above).
  • Deposits declined for the first time since 2018 (but still way above pre-pandemic levels).
  • # of problem banks remain unchanged at 40.

 

• Ramp (corporate card and expense management platform) reportedly to launch cross-border B2B payments in the next 60 days per this Payments Dive article.

 

• UBS announced the mutual termination of Wealthfront merger agreement ($1.4B cash acquisition price) and instead has invested $69.7M via a convertible note at approximately the same total valuation.

 

• Bond (BaaS middleware / connector) launched white label commercial charge card solution enabling “B2B SaaS platform providers to launch their own commercial charge cards without writing a single line of code.”

 

• Notable FinTech funding for the week:
  • Bitwarden (open source password manager) announced $100M in capital in an undisclosed round referencing a growth investment.
  • Mesh Payments (corporate spend automation platform) raised $60M in new financing.
  • Chargezoom (B2B invoicing integrated payments) raised $10M in Series A.
  • Boopos (M&A alternative lending platform based on revenue financing model) raised $58M in capital consisting of $8M in Series A plus $50M in debt financing.
  • Stack (crypto education and trading app for teens and their parents) raised $2.7M in new funding and launched this week with over 6,000 users on the waitlist.

 
 
Random Uncle Sean Stuff:

• Remembering Queen Elizabeth II who passed away peacefully at her summer residence, Balmoral Castle in Scotland, this week at the age of 96 after 70 years of service to the United Kingdom.  This collage from Town & Country has 108 photos of Queen Elizabeth life in pictures.  NPR also has a great collection of pictures as well.
  • This statistic really jumped out at me – when Queen Elizabeth first took the throne at the age of 25, the UK prime minister was Winston Churchill who was born in 1874.  At the time of her death, the current prime minister is Liz Truss who was born 101 years later in 1975.
  • Maybe the best reflection I read was a simple LinkedIn post from Agility Bank, “Our deepest sympathy goes to the #RoyalFamily and citizens of the #UnitedKingdom in the loss of Her Majesty Queen Elizabeth II.  Her actions over a 70-year reign speak louder than any words.  Her quiet leadership, her dignity, and her steadfast service to her people will always be remembered by those of the countries she watched over and by those of us who admired her from afar.  You will be missed, Your Majesty, by everyone.”

 
 
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 Labor Day Weekend!!!
 
It was a busy week with a lot of updates leading into the Holiday weekend, so let’s get right to it - Here is the Uncle Sean Update for 9/2/22:
 

• Congratulations to Mr. Robert Keil, Chief Payments Officer at Sutton Bank, for being nominated by his peers as the inaugural Chairman of the Board of Directors for the BHB BaaS Association!!!!

 

• Hmmm – this will be interesting to watch….  Block (fka Square) Cash App users (80 million strong by the way) can now make payments on e-commerce sites outside the Square network via Cash App Pay.
  • Previously this was a closed loop network meaning that users could only make payments using Cash App Pay on Square terminals or online Square merchant partners.
  • For now, Block has “partnered with American Eagle, Aerie, Tommy Hilfiger, Finish Line and JD Sports for the launch with more merchants like Romwe, Savage x Fenty, SHEIN, thredUP and Wish coming to follow in the coming months.”  Block is automatically offering a 10% discount to users when they make their first purchases with these merchants using Cash App Pay.

 

• For my compliance folks out there…  Per an 8-K filed on 8/29, Blue Ridge Bank has entered into a written agreement with the OCC after the regulator found “unsafe or unsound practice(s), including those relating to third-party risk management, Bank Secrecy Act (“BSA”) /Anti Money Laundering (“AML”) risk management, suspicious activity reporting, and information technology control and risk governance.”  😲
  • The main emphasis being to “adopt, implement and adhere to a written program to effectively assess and manage the risks posed by the Bank’s third-party fintech relationships” as well as “obtain an OCC non-objection prior to onboarding or signing a contract with a new third-party fintech partner, or offering new products or services or conducting new activities with or through existing third-party fintech partners.”  Additionally, the agreement requires Blue Ridge Bank to:
    • Adopt, implement and adhere to an effective written Bank Secrecy Act (“BSA”) risk assessment program to ensure BSA compliance risk assessments provide a comprehensive and accurate assessment of the Bank’s BSA compliance risk across all products, services, customers, entities, and geographies, including all activities provided by or through the Bank’s third-party fintech partners;
    • Adopt a revised independent BSA audit program that includes an expanded scope and risk-based review of activities conducted through the Bank’s third-party fintech partners.
    • Agreement will remain effective until it is amended by the Bank and the OCC, or the OCC modifies, waives or terminates the Agreement.

 

• Aeldra announced they shutting down operations and Blue Ridge Bank will be issuing final checks to consumers on Sept 9 for any remaining funds in their Aeldra account.

 

• LevelField Financial (financial services firm) announced the acquisition of Netshares Financial Services (an SEC registered broker-dealer) as part of their overall strategy to bring “traditional banking and digital asset products and services in one trusted platform.”  LevelField has also hired PNC Bank as an advisor to acquire a U.S. chartered bank and is reportedly seeking a $50M VC round.

 

• Jack Henry announced that they teamed up with Google Cloud to accelerate JKHY’s multi-year modernization strategy by bringing cloud-first technology to banks and credit unions.  Also this week, JKHY announced the completion of the Payrailz acquisition.

 

• First National Bank of Omaha announced the launch of launch of Bend by FNBO as a new credit card-as-a-service (CaaS) solution to allow digital brands / fintech companies to launch an embedded credit card solution.  Check it out at bendbyfnbo.com.

 

• Highnote expands their partnership with Visa as an issuer processor on Visa Cloud Connect.  Highnote also announced they are working with GiveCard to launch a new prepaid debit card (issued by Sutton Bank) to enable shelters, non-profits, and governments to scale cash transfer programs and quickly serve the needs of their target community.

 

• U.S. Bank announced they are raising their minimum pay to $20 per hour starting in early November.  This is the second minimum wage increase announced by U.S. Bank this year. 

 

• The Federal Reserve narrowed the FedNow Service launch to mid-2023 specifically targeting May – June timeframe; and marks the beginning of full-scale pilot testing in mid-September with more than 120 organizations participating.  Additionally, Fed Vice Chair Lael Brainard requested industry stakeholders to devote the resources necessary to support instant payments including “upgrading back-office processes, evaluating accounting procedures to accommodate a seven-business-day week, arranging liquidity providers, deploying a new customer-facing application, and promoting instant payments for key use cases to customers” to facilitate the shift to real-time payment infrastructure.
  • For more on FedNow, go to explore.fednow.org.

 

• The United States Federal Bureau of Investigation (FBI) issued a new warning for investors regarding DeFi hacks warning that cybercriminals are increasingly exploiting vulnerabilities in decentralized finance (DeFi) platforms to steal cryptocurrency.  The FBI PSA stated, “between January and March 2022, cybercriminals stole $1.3 billion in cryptocurrencies, almost 97 percent of which was stolen from DeFi platforms according to blockchain analysis firm Chainalysis”.

 

• Klarna (BNPL) losses quadruple as revenue increases on 24% for the 1H2022.  OUCH!

 

• Notable FinTech funding for the week:
  • RentSpree (end to end rental management software for renters, agents, and landlords) raised $17.3M in Series B funding round.
  • Solid (fka Wise, a fintech infrastructure / middleware / BaaS connector) raised $63M in Series B round.
  • Alloy (fraud / identity decisioning platform for banks and fintech companies) raised $52M in Series C extension.
  • VRGL (institutional wealth management analytics) raised $15M in Series A.
  • Willow Servicing (cloud-based mortgage servicing) picked up a $6M Seed round.
  • Landa (fractional RE investing) emerged from stealth mode with $33M in capital funding including a recent $25M Series A and a previous $8M Seed round.

 
 
Random Uncle Sean Stuff:

• Labor Day Weekend is here and with it comes the end of the dog days of summer and early hints of fall!!!!  Ahhhh, all feels right with the world again.  In Texas it means football, slightly cooler temperatures, much needed rain, Dove season, Hatch chile pepper season, holiday scheduling / planning with family, and yes – pumpkin spice flavored everything.  😃
  • Uncle Sean expects the stores to be packed with Christmas decorations any day now (SMH)….
  • Also - don’t forget to renew those Texas hunting and fishing licenses as of Sept 1!!!
• Check out the 110 year old Battleship Texas move through the Houston Ship Channel as she left La Porte, TX for some much needed repairs at a shipyard in Galveston, TX.  
• Dad Jokes are back:
  • I went by the house that I grew up in and asked if I could go in and look around.  They said NO and slammed the door…..  Geez, my parents can be so rude sometimes!!!
  • I don’t think the therapist is supposed to say “WOW” that many times in your first session, but here we are…   😝
  • Carrots can be good for your eyes, but alcohol can double your vision - LOL!!!
  • You ever take one of those naps that is so good that you abruptly wake up gasping thinking you missed the school bus….  But it’s Sunday….  And you’re 52… 
    • Yeah – hoping I get one of those this weekend!!! 😊

 
 
Have a GREAT LABOR 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.