​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.
 

Happy Friday!!!
 
Here is the St. Patrick’s Day edition (queue up the bag-pipes and green beer) of the Uncle Sean Update for 3/17/23:
 
Okay – Uncle Sean will be fairly brief on the SVB and Signature Bank stuff as sometimes it is more powerful (and appropriate) to say very little than to continue shouting the same narrative.  So here is a quick commentary and then on to MANY GOOD THINGS that happened this week:
 

• As everyone knows, last Friday Silicon Valley Bank was closed.  In an extremely rare Sunday maneuver, Signature Bank was closed…  Both of which are being labeled as idiosyncratic events that resulted in a modern-day bank run and NOT indicative of a greater systemic problem (and Uncle Sean agrees). 
  • This leads me to two main premises: 1) What exactly is a sticky deposit (this is an intentional rhetorical and sarcastic thought provoking question); and 2) I wonder if we are fully prepared for the speed and convenience at which we can move money now (and it is only going to get faster)…..
    • To put the speed factor in perspective (credit Felix Salmon at Axios for pointing this out), SVB depositors withdrew $42B from the bank on a Thursday…  The largest bank run in history (WaMu in 2008) had deposit outflows of $16.7B over the course of 10 days…  Please take a moment to let that really sink in…..  Here is some more info (again, credit Felix Salmon at Axios):
      • The SVB outflow equates to about $4.2B an hour, or more than $1M per second for ten hours straight…..  HOLY MOLY!!! 😲
  • Also for reference, the 2 bank failures in the last few days totaled $319.4B in Total Assets compared to 25 failures totaling $373.6B in all of 2008 (source: FDIC).

 
HERE IS THE GOOD NEWS that we can all feel better about (Uncle Sean sending good vibes): 😊
 

• The Fed response to the bank failures was swift and two-fold in an effort to stave off any further contagion:
  • 1) All deposits at Silicon Valley Bank and Signature bank will be honored regardless of amount  (including in excess of $250K) under the systemic risk approval.
  • 2) The launch of the Bank Term Funding Program (BTFP) offering loans of up to one year in length to banks, savings associations, credit unions, and other eligible depository institutions pledging U.S. Treasuries, agency debt and mortgage-backed securities, and other qualifying assets as collateral. These assets will be valued at par (not fair value). The BTFP will be an additional source of liquidity against high-quality securities, eliminating an institution's need to quickly sell those securities in times of stress.
    • Of course this only lasts for a year, but it allows for favorable borrowing and immediate relief surrounding liquidity concerns stemming from interest rate / duration risk in securities portfolios.
    • Both of these steps were extremely important and completed very quickly over the weekend.  Uncle Sean was happy to see this - nicely done!!!

 

• Here are some more good things to check out if you are concerned about uninsured deposits (Dad used to tell me and Davey to try to offer solutions, not just complaints):
  • IntraFi Network Deposits (an IBAT Endorsed Service Provider) absorbed what used to be called the Certificate of Deposit Account Registry Service (CDARS), and Insured Cash Sweep (ICS).  IntraFi Network Deposits providing “millions of FDIC insurance and peace of mind.”
  • Reich & Tang Deposit Solutions – check out their recent PR stating up to $50M in FDIC insurance through the Demand Deposit Marketplace® Program (DDM®).
  • Impact Deposits Corp. (f/k/a CDC Deposits Corp.) can offer FDIC insurance up to $50M per tax ID according to their website - Impact Deposits Corp.

 

• And another SUPER COOL thing that happened this week – the largest U.S. banks banded together to provide $30B in liquidity to First Republic Bank.  This is essentially a 120-day unsecured loan, but here are three things that caught my attention and made me feel good:
  • 1) Although the U.S. Treasury was in contact with these institutions, these largest banks did this on their own; and is a first of its kind!
  • 2) If you’ve ever tried to get a joint press release out (especially with a publicly traded institution), it almost requires divine intervention to get anything accomplished within a month – so I was amazed (and happy) to see this PR go out so quick and efficiently - LOL!!!!
  • 3) I want to REALLY focus on these specific lines in the PR (bold and cap emphasis added by Uncle Sean):
    • “This action by America’s largest banks reflects their confidence in First Republic and in banks of all sizes, and it demonstrates their overall commitment to helping banks serve their customers and communities.  Regional, midsize and small banks are critical to the health and functioning of our financial system.”
    • “America’s banks – large, midsize and COMMUNITY BANKS – do an extraordinary job serving the banking needs of their unique customers and communities.  The banking system has strong credit, plenty of liquidity, strong capital and strong profitability. Recent events did nothing to change this.”
    • “Smaller- and medium-sized banks support their local customers and businesses, CREATE MILLIONS OF JOBS AND UPLIFT COMMUNITIES.  America’s larger banks stand united with all banks to support our economy and all of those around us.” 
      • HELL YEAH!!!!  And I will add on a personal note that Uncle Sean is proud to be a part of this amazing and hugely important industry!!!!  😊

 
Now, the rest of the news:
 

• COCC announced a partnership with Advanced Fraud Solutions (AFS) - Despite the diminishing number of checks being produced, the majority of institutions have reported steady or increased rates of check fraud.

 

• Sezzle announced proposed direct U.S. listing on Nasdaq pending release of S-1 and SEC review.

 

• Guild Mortgage announced the acquisition of Cherry Creek Mortgage.

 

• Federal Reserve announces July launch of the FedNow service.

 

• Just in time for tax-prep (YUCK), Creative Juice announced the launch of Juice Books, a tax prep toolkit to help creators sort out their finances for tax-time.

 

• Notable FinTech funding for the week (see - the sky didn’t fall):
  • It finally happened!  😊 Rumored for about a year now, Stripe officially announced that they raised $6.5B in Series I funding round at a $50B valuation.
  • Apexx Global (merchant payment platform) raised $25M in Series B funding round with continued expansion efforts targeting North America.
  • Payabli (SaaS payments API provider) completed an $8M extension round bringing their total Seed Round to $12M.
  • Wingspan (payroll and onboarding platform for independent contractors that also includes business banking) raised $14M in Series A funding.
  • Parker (corporate credit cards to e-commerce businesses) emerged from stealth this week and announced that they have raised $157M in total funding including $5.9M in Seed, $31.1M in Series A, and a $70M debt facility with an option to upsize by $50M.

 
 
Random Uncle Sean Stuff:

• Well CRAP!!!  March Madness brackets got crushed before the sun went down on Day 1 as #13 Furman beat #4 Virginia and #15 Princeton took down #2 Arizona. 😲

• It’s now daylight savings time; and Spring officially starts on Monday – so turn off the TV and social media, GO OUTSIDE AND PLAY, breathe fresh air, and enjoy nature – it’s SUPER GOOD for you!!!!  All this other news crap will be here on Monday, I promise!  😊
• Alright – you knew it was coming….  Here are some Saint Patrick’s Day jokes:
  • Never loan money to leprechauns…  They are always a little short!
  • Faux Irish stones are called shamrocks….
  • The bartender said to me, “Your glass is empty, can I get you another one?”  To which I calmly replied, “why on Earth would I want two empty glasses???” 😝

 
 
Have a GREAT weekend, GO OUTSIDE AND PLAY - 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!!!
 
Fintech | Banking | Data – it’s what we do.  Here is the Uncle Sean Update for 3/10/23:
 

• It’s been a tumultuous week in the banking sector – I’m not happy about reporting on any of this, but it has dominated the news all week.  So let’s jump right in and take a look at what happened (spoiler alert – deposit concentration risk is bad):
  • Silvergate (NYSE: SI; BHC FR 3695667; Bank Sub is Silvergate Bank – FDIC 27330; $11.4B Total Assets as of Dec 2022) announced this week that they will voluntarily liquidate the bank after a massive runoff in deposits from the crypto sector stemming from the FTX collapse.  I won’t take anymore time on this one as we have been reporting about Silvergate for a couple of months.
  • In an extremely rapid turn of events – almost overnight, Silicon Valley Bank (NASDAQ: SIVB, FDIC 24735; $209B Total Assets as of Dec 2022) was closed by regulators.  This is the second largest bank failure of all time behind Washington Mutual back in the heart of the financial crisis in 2008.  Here is the chain of events:
    • Late Wednesday, SVB announced a proposed equity capital raise of about $2B (further diluting shareholders) as well as the sale of essentially all of their AFS securities portfolio resulting in a hit to regulatory capital of $1.8B post-tax benefit.  They posted a mid-quarter update showing +$450M improvement in annualized NII after rebalancing the securities portfolio and capital raise with approximately $180B of available liquidity.
      • The liquidity driver was driven by a bleed off of deposits from their customer base (VC backed companies having higher cash burn in our current environment).  Worth noting that SVB non-interest bearing deposits went from $121.7B in Dec 2021 to $79.4B in Dec 2022 (source: FedFis bank call report data).
    • Per this TechCrunch article, SVB CEO Greg Becker held a call with venture clients telling them their assets were safe and the bank had ample liquidity “with one exception: If everybody is telling each other that SVB is in trouble, that will be a challenge.” The executive asked VC clients to “stay calm…”
      • Uncle Sean moment here - If you have EVER been in a heated discussion (i.e. argument) with your spouse or significant other, you know that saying “stay calm” is like trying to put out a fire by pouring gasoline on it…  😲 
    • Of course it did not work (I know – shocking, right?!?!) and there are several reports that venture firms were advising their portfolio companies to move money out of SVB.  And that is how the bank run started.  By Friday morning, CNBC reported that the equity funding fell through, stock price was down 80+% for the week, pre-market trading had been halted, and SVB was seeking a buyer.  Deposit outflows were outpacing the sale process; and a few hours later the bank was closed by regulators that same morning.
  • More Uncle Sean op-ed here…  There may be more information in the coming weeks, but both of these scenarios are not your garden variety bank failure.  The speed in which all of this unfolded was shocking.  There has been a ton of reporting related to mismatched ALM and AFS securities portfolios with unrealized AOCI losses – and all of that has some merit.  But let’s be honest.  A $2B hit to SVB with $210B in Assets, $13B in cash, and $15B in equity is NOTHING – that is not what caused this failure….  This was a panic induced bank run that was promulgated by deposit concentration risk within VC and VC portfolio companies.
    • “Niches to Riches” doesn’t work well on the regulatory banking side when you have industry specific deposit concentration risk...  Or, maybe I should phrase it as, “it works great right up to the point that it doesn’t – then it the becomes catastrophic.”  Diversification is key to liquidity whether it is deposits, loans, or industry concentrations.
    • Uncle Sean certainly hope the best for all people impacted by these two unfortunate events.

 

• Ugh - a couple more pieces of bad news….
  • Catch (payroll and benefits platform for self-employed) announced they are shutting down.
  • The NCUA announced that they liquidated Inter-American Federal Credit Union (charter #16285; $727K Total Assets; 460 members) due to unsafe and unsound practices.

 

• Alright - now that we have the bad news out of the way, here is some GREAT news…  Look at CSI flex their muscles by announcing a record setting year signing 33 new core banking agreements, a 30%+ increase over the companies previous record, pushing their US market share up to 10%.  NICE WORK!!!!  😊

 

• HM Bradley selects NYCB (division of Flagstar Bank) as their new sponsor bank and also partnered with Thought Machine to provide real-time ledgering.

 

• Step (teen banking and credit builder app) launches stock investing powered by Drivewealth, LLC.

 

• InvesTex Credit Union (Charter 67637; $241M Total Assets) based in Humble, TX converts from NCUSIF to private share insurance from American Share Insurance (ASI).

 

• ICE and Black Knight find a buyer for Empower as the FTC takes action to block their merger stating it would harm competition and lead to higher costs.  ICE responded stating they strongly disagree and will vigorously oppose the FTC’s challenge of ICE to acquire Black Knight.

 

• Fifth Third Bancorp (NASDAQ: FITB; FDIC 6672) to acquire Big Data Healthcare a technology solutions provider for healthcare payments and remittance.

 

• Notable FinTech funding for the week:
  • Synctera (BaaS middleware/connector platform) raised $15M in capital and partners with National Bank of Canada.
  • Droit (reg compliance platform for big banks) $23M in Series B funding round.
  • FilmHedge (financing for film and television productions) raised $5M in Series A plus a $100M credit line.
  • Candidly (student debt and savings platform) raised $20.5M in Series B round following record growth of 10X revenue.
  • Banyan Infrastructure (project finance software for banks, investors, and developers in the renewable energy space) announced $25M in Series B funding round.

 
 
Random Uncle Sean Stuff:

• It’s daylight savings time this weekend so don’t forget to set your clocks forward 1 hour on Sunday, March 12, 2023 at 2:00AM for those states that recognize it.
• Speaking of March 12th….  Happy Wedding Anniversary to Aunt Patty for putting up with Uncle Sean’s antics for 29 years now!  Poor girl…  LOL!!!!  😝
• Lastly, here are some safety tips for driving in the snow from one of my friends up North:
  • Install winter tires
  • Drive South
  • Continue until you see sand and palm trees
  • Apply brakes & sunscreen

 
 
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 3/3/23:
 

• The FDIC released the Quarterly Banking Report for Fourth Quarter 2022 and the banking industry looks good.  Key Points include:
  • Net Income slightly lower than 2021 (mainly due to higher provision expense as banks are starting to increase reserve levels), but still higher than pre-pandemic averages.
  • Loan balance increased by a massive 8.7%; and  NIM continues to expand to 3.37% - above pre-pandemic levels.
  • Asset quality remains favorable.  While noncurrent and net charge-off rates ticked up, they are still better than pre-pandemic levels.
  • Deposit balance are still declining, but at a slower pace – and deposit balances are still well above pre-pandemic levels.
  • Number of problem banks declined to 39 (lowest since data collection began in 1984) from 42 and includes the removal of a larger institution from the list since the total assets held declined from $116.3B to $47.5B.

 

• Redemption Holding Company (RHC) announced an agreement to acquire Holladay Bank and Trust (FDIC 21448; $68M Total Assets) “marking the first time in American history that an existing commercial bank would become a Black-owned Minority Depository Institution ("MDI") through acquisition. RHC will become the only Black-owned bank serving the Mountain West pending federal regulatory approval.”  VERY COOL!!! 😊

 

• This is great - Our Credit Union friends are making headlines this week,  Michigan State University FCU (charter 23279; $7.3B Total Assets) goes live with not one, but two new standalone digital brands powered by NYMBUS.  Check them both out at AlumniFi and Collegiate.
  • At FedFis we refer to this as the direct digital bank concept (a division of the chartered institution); and can be a profitable and compliant way for FI’s to bring a diversified revenue stream into the bank via targeted market solutions (or “niche segments” as Nymbus accurately describes them in the press release).  Uncle Sean loves seeing this in the CU space – great work!!!!

 

• Prepaid Technologies (digital payments and prepaid debit) is rebranding to Dash Solutions and will also bring WorkStride (rewards platform) under the same unified brand.

 

• BankProv (Provident Bank; FDIC 12010) announced a partnership with MaxMyInterest (cash management platform to maximize savings rates) via the BankProv Max Savings offered exclusively on the Max platform.   

 

• Spruce by H&R Block (mobile app) has partnered with Atomic to help customers set up direct deposit from their employer quickly and easily to their Spruce spending account without the need for complicated payroll forms or tedious processes.

 

• And another really cool partnership – Baker Hill (loan origination, risk management and analytics) has partnered with Alloy (identity decisioning platform) allowing FI’s using Baker Hill NextGen® to leverage Alloy Onboarding to “verify prospective borrowers quickly and accurately with fewer manual reviews and less fraud while complying with KYC and AML requirements.”

 

• DoorDash announced the launch of the DoorDash Rewards Mastercard co-branded CC adding more embedded finance functionality to their overall ecosystem (see DasherDirect platform).

 

• LendingTree (NASDAQ: TREE) makes the jump into embedded finance by announcing the launch of the LendingTree Win Card (wait list) by Visa and powered by Upgrade with the ability to earn up to 2% cash back.
  • Essentially, this is a co-branded credit builder platform via Visa Signature secured credit card backed by a personal loan that allows for credit increases as customers improve their credit score through successful payments.

 

• Remitly announced they will be winding down Passbook (neobank app for immigrants) effective May 1, 2023 to focus on their core business of global money-transfer.

 

• Ugh, tough times…  Silvergate (NYSE: SI; BHC FR 3695667; Bank Sub is Silvergate Bank – FDIC 27330) warned in a SEC filing that it was delaying its annual report due to the following:
  • Had to sell additional securities beyond what was anticipated to repay the $4.3B FHLB advance, resulting in additional losses negatively impacting regulatory capital.  As a result, the bank may be less than well-capitalized.
  • Dealing with regulatory, audit, and legal investigations; as well as congressional inquiry.  Forcing the bank to reevaluate their business strategy.
  • Evaluating the full effect this will all have on their ability to continue as a going concern.
    • Unfortunately, CNBC is reporting that additional firms (Coinbase and Galaxy) are now dropping Silvergate as their banking partner fueling additional liquidity concerns.  ☹

 

• While on the topic of crypto, Uncle Sean did notice that 2 crypto firms have made announcements to acquire small IL state chartered banks in February……  We shall see if these pass regulatory approval given the current environment:
  • 2/1/23 – LevelField Financial to acquire Burling Bank (FDIC 27556; Total Assets $197K with 18 full time employees and 1 location).
    • LevelField is a start-up crypto trading platform with additional services “coming soon” such as mobile app, custody, and crypto rewards credit card.  They are developing an Easy Trade White Label solution for banks.
  • 2/22/23 - Metallicus, Inc. has formed FBBT Holdings, Inc. to acquire State Bank of Nauvoo (FDIC 13582; Total Assets $37K with 8 full time employees and 2 locations).
    • Metallicus is a crypto and blockchain company with a crypto mobile trading app.

 

• Meanwhile, Circle released their first annual State of the USDC Economy report which I found to be a very good read.  Check out the easy to understand glossary on page 20 if you need to brush up on your crypto lingo (like me).

 

• On the reg side, the CFPB published their new findings on financial profiles of BNPL borrowers essentially rebuking BNPL as an avenue for credit to those who lack access to credit products. 
  • CFPB Director, Rohit Chopra stated, “Since Buy Now, Pay Later is like other forms of credit, we are working to ensure that borrowers have similar protections and that companies play by similar rules.”

 

• And more bad news for SBF…  FTX former engineering head, Nishad Sigh, plead guilty to criminal charges this week including “conspiracy to commit securities fraud, conspiracy to commit money laundering, and conspiracy to violate campaign finance laws.”

 

• Rumor mill – Uncle Sean usually tries to stay away from reporting on rumors, but this one caught my attention pretty quick:
  • Visa Inc. is allegedly in talks to acquire Fidelity National Information Services (FIS).  WOWZA!!! 😲
    • There are certainly plenty of arguments on both sides of the fence related to if / how / should a deal like this be allowed (recall DOJ blocking Visa’s $5.3B proposed acquisition of Plaid).  Also recall FIS’s recent divestiture/spinoff of WorldPay that could certainly be viewed as strategic posturing to this merger.  I guess only time will tell….

 

• Notable FinTech funding for the week:
  • Pagos (payments infrastructure) raised $34M in Series A funding round that was oversubscribed.
  • Vouched (red hot identity verification space) raised $6.3M in Capital and now serves “more than 300 banks, fintechs, and healthcare providers.”
  • Marco (trade finance platform for LatAm exporters) raised $8.2M in new equity capital plus a $200M credit facility
  • Archway (API enabled modern tech integration platform - recently spun off from WaFd Bank) raised $15M in Series A round.

 
 
Random Uncle Sean Stuff:

• Happy Texas Independence Day!!!!  March 2, 1836, Texas declared its independence from Mexico and became a republic – basically its own country for nearly 10 years until Texas officially became a state in 1845.

• ICYMI, Berkshire Hathaway released their 2022 Annual Report – its’s always entertaining to read the Chairman’s Letter by Warren Buffet.  The “Charlie Thoughts” on pages 9-10 are solid gold!
• Anyone besides me notice instances of “shrinkflation” recently??? 
  • A bag of ice was $2 for a 10lb bag and is now $2 for a 7lb bag – 30% shrinkflation.
  • The double bag of charcoal I have been buying was $20 for 2 bags that were 20lbs each and is now $20 for 2 bags that are 16lbs each – 20% shrinkflation.
  • Pretty soon a 6-pack of beer will only have 4….. LOL!!!

• And of course some Dad Jokes to get us into the weekend vibe:
  • The sign in the grocery store said, “Manager’s Special.”  Seemed odd as he looked fairly average to me!
  • The French love escargot because they don’t like “fast” food….
  • That silent moment after a toddler falls over is the epitome of parental anxiety – because they are either absolutely fine or filling their lungs with enough air to mimic a tornado siren.  Bwahahahaha!!!!  
  • And lastly, I successfully changed a lightbulb in the house this week and immediately had to remind Aunt Patty of the high quality stud that she married – 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!!!
 
It’s hard to believe this is already the last Friday in February!  Here is the Uncle Sean Update for 2/24/23:
 

• Huge shoutout to AeroVision as the latest innovative firm to join the BaaS Association!!!
  • “Guiding AeroVision’s banking partners to success with their Fintech Programs will be their number one goal that helps increase the momentum of an industry that has the potential to grow at a much faster rate.”  OUSTANDING!!!!

 

• ICYMI - Bankers Helping Bankers announced the first close of funding and the beginning of capital deployment of the BHB Fund with the investment emphasis of this first close towards “early-stage companies that solve ‘here and now’ opportunity and challenges facing community banks.”  Yep – making a difference and loving it!!!!  😊

 

• Changed, the CUSO that helps members pay off student loans (they are a Mark Cuban and Shark Tank backed fintech – how cool is that!!!), announced they are expanding to include mortgage, auto, and personal loans as well as credit scores in one centralized dashboard application helping members with their financial health – VERY NICE!!!!!

 

• DCI (Data Center Inc.) is making headlines again this week announcing a partnership with Hawthorn River offering DCI customers an end-to-end digital LOS platform for a variety of loan types.  Check them out at hawthornriver.com.

 

• Choice Bank (FDIC 9423) and Cloudcase US, Inc. announced the launch of the banks new end-to-end digital agriculture supplier financing platform.
  • Uncle Sean loves this intersection of AgTech and FinTech – and to see it being done with a leading BaaS Bank is icing on the cake to me!!!

 

• MoneyLion announced a partnership with Column Tax to offer eligible MoneyLion RoarMoney℠ Banking customers a free embedded tax filing service.

 

• CoreLogic® announced they have acquired Roostify’s digital mortgage tech platform.

 

• Stripe launches Enhanced Issuer Network with major US issuers including Capital One and Discover to “help businesses reduce fraud and boost authorization rates” via the Stripe Radar fraud scoring/prevention solution.

 

• Helix by Q2 (NYSE:QTWO) announced a partnership with Unit21 to provide fintech customers with Unit21’s fraud detection and investigation infrastructure.  

 

• The Federal Trade Commission (FTC) has launched a new Office of Technology to “keep pace with technological challenges in the digital marketplace…”
  • Certainly worth keeping an eye on as Uncle Sean can’t help but notice this directly coincides with other very recent regulatory initiatives, such as:
    • FDIC - FDITECH Office of Innovation
    • OCC - Office of Financial Technology
    • CFPB - Office of Competition and Innovation

 

• Marqeta (NASDAQ: MQ) beefs up their compliance and executive team by announcing the hiring of Crystal Sumner as Chief Legal Officer to oversee Marqeta’s global legal and regulatory affairs.  Sumner was most recently the Head of Legal, Compliance, and Risk at Blend; and before that served as an Enforcement Attorney at the CFPB.
  • Uncle Sean sees this as a very strategic addition to the executive team as Marqeta continues to add functionality to their platform; AND the continued regulatory/compliance emphasis in the banking sector with a focus on BaaS.

 

• The trifecta speaks to liquidity risks in crypto-industry related deposits….  The FDIC, Federal Reserve, and OCC issued a joint statement on liquidity risks resulting from crypto-asset-related entities specifically regarding volatility of deposit inflows and outflows.  The statement reminds banking organizations to apply existing risk management principles; it does not create new risk management principles.
  • Not entirely surprised to see a cautionary warning from the regulators after witnessing Silvergate’s recent $8.1B (68%) deposit runoff in 4Q2022 as crypto contagion spread to the regulated banking industry.

 

• And another bad week for Binance…  Binance.US $1B bankruptcy bid to purchase Voyager Digital is facing formal regulatory opposition from the SEC and NYDFS...
  • Also this week, the FTC filed a formal objection to the sale citing an investigation into Voyager regarding “deceptive and unfair marketing of cryptocurrency to the public” and the potential of the proposed bankruptcy sale to Binance.US to release Voyager and its employees from financial claims and wrongdoing. 

 

• FTX founder Sam Bankman-Fried (SBF) is also having a bad week with a new superseding indictment charging him with four new criminal charges including commodities fraud and unlawful political contributions which, if convicted, could pose an additional 40 years in prison….  😲

 

• Notable FinTech funding for the week:
  • Finch (API for payroll, benefits, and HRIS) raised $40M in Series B funding round citing 12x revenue growth since their Series A last June.
  • Green Check Verified (compliant cannabis solutions for financial institutions) raised $6M in Series A round.

 
 
Random Uncle Sean Stuff:

• This is awesome – As former President Jimmy Carter enters hospice care at home this week, the Habitat for Humanity recognized President Carter and former first lady Rosalynn Carter as humanitarian champions and tireless advocates and dedicated hands-on Habitat volunteers for almost 4 decades of continued service.  According to Habitat.org, President and Mrs. Carter have worked alongside 104,000 volunteers in 14 countries on 4,390 homes.
  • President Carter’s humble life is well represented in this CNBC article stating that the two bedroom 1961 house that he still lives in is assessed at $167,000 which is “less than the value of the armored Secret Service vehicles parked outside.”
  • Check out this timeline of Carter Work Project pics throughout the years!
    • This is by far my favorite pic (showing up to volunteer in 2019 after a fall with 14 stitches and a black eye) that captures the quiet and humble spirit and determination of President Carter in his service to others:
      
      • https://www.dropbox.com/sh/krnnbl8ebmic3lc/AADKhwZwxtf-bDWpuCSgzuJba/Historical%20photos?dl=0&preview=Habitat-Carter+Photo+48.jpg&subfolder_nav_tracking=1
• What do I think about ChatGPT and AI???  Well, I kind of look at it like not needing to learn how to spell very well because of autocorrect – to which I am eternally grapefruit.  😝

 
 
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 – what a wild week for divestiture news and regulatory smackdown in the crypto world!  Here is the Uncle Sean Update for 2/17/23:
 

• FIS announced it will spin off its merchant services business to be named (err re-named) Worldpay which it had acquired in 2019 for $43B ($35B Cash consideration plus $8M debt). 
  • Reuters noted that FIS took a $17.6B write-down of its merchant business as part of the spin-off effectively “undoing a $43 billion acquisition that went sour.” 

 

• Finastra is also exploring a $7B sale of its banking unit that provides core processing software to banks and CUs.

 

• Global Payments has agreed to sell its gaming solutions business for $415M to Parthenon Capital Partners furthering Global Payments emphasis towards corporate customers.  Recall back in August where Global Payments sold their Netspend consumer business for $1B.

 

• Not entirely unexpected, Black Knight (NYSE: BKI) is also reportedly looking to divest their Empower loan origination software in order to gain regulatory approval for their $13B planned sale to InterContinental Exchange (NYSE: ICE).

 

• Zelle continues to rapidly gain market share increasing 40% in 2022 to 1,800 financial institutions joining the Zelle Network®.  Some key 2022 stats:
  • 97% of the FI’s that joined in the last year were under $10B in assets.
  • Zelle processed 2.3 billion payments with total value of $629B.
  • Small business adoption using Zelle continues to be very strong.

 

• This makes me happy 😊 – two great firms doing great things together to help consumers!!!!!  DCI partners with Atomic for payroll connectivity allowing DCI customers to offer their account holders a quick and easy way “to set-up and switch direct deposits, enable early access to earned wages, and seamlessly verify a user’s income and employment status.”
  • “Partnering with Atomic helps us boost our digital banking solutions by digitizing direct deposit, and adding verify and earn solutions,” said Sarah Fankhauser, DCI’s President and CEO. “When a new partnership helps our banks keep competitive with the larger financial institutions, it’s a win-win for us all.”

 

• Mahalo Banking (CUSO providing online and mobile banking for CUs) announced the launch of its next-generation banking platform engineered to deliver “neurodiverse functionalities intended to improve accessibility and better accommodate the cognitive needs of all credit union members” by catering to members with neurodiverse abilities and cognitive distinctions such as dyslexia, autism, ADD, ADHD, epilepsy, visual sensitivity, ASD and more.

 

• Citizens Financial Group selects Paymentus (NYSE: PAY) for bill pay and money movement for their retail banking customers.

 

• AmeriSave Mortgage is now offering online unsecured personal loans from $5K - $50K.

 

• More C-Suite personnel updates this week:
  • Rocket Companies (NYSE: RKT) announced CEO transition plan with current CEO Jay Farner to retire effective June 1 and Bill Emerson to assume the role of interim CEO.
  • BankProv (Nasdaq: PVBC) announced Co-CEO Leadership Team appointing Carol Houle and Joe Reilly as Co-CEOs and Co-Presidents effective immediately.
  • Signature Bank (Nasdaq: SBNY) announced leadership transition plans where current Co-founder, President and CEO Joseph J. DePaolo will transition to a senior advisor role; and current COO Eric R. Howell will succeed DePaolo as President and will eventually transition to CEO as well.
  • Visa (NYSE: V) announced the retirement of CFO, Vasant Prabhu effective Sep 30, 2023.

 

• The FDIC demanded four entities cease making false or misleading representations about deposit insurance.

 

• WOW - The regulatory crackdown on crypto continues this week, but the SEC scope has expanded from staking to now include certain stablecoins as a security – which has the entire crypto industry on edge.  Let’s take a look at recent developments:
  • Bad news for Binance???  New York financial regulators ordered Paxos to stop issuing Binance stablecoin (BUSD).  Paxos is also facing potential litigation from the SEC claiming that the BUSD stablecoin is a security and therefore subject to securities law.
    • Paxos has issued a statement categorically disagreeing with the SEC, claiming BUSD is not a security.
      • Wired has a really good summary article titled “Confusion Spirals in Crypto as the US Cracks Down.”
  • Coinbase is taking aim back at the SEC (good luck with that BTW) stating their staking services not securities and will defend in court if needed.
    • To reiterate from the SEC press release - Kraken Settlement last week, “Whether it’s through staking-as-a-service, lending, or other means, crypto intermediaries, when offering investment contracts in exchange for investors’ tokens, need to provide the proper disclosures and safeguards required by our securities laws,” said SEC Chair Gary Gensler. “Today’s action should make clear to the marketplace that staking-as-a-service providers must register and provide full, fair, and truthful disclosure and investor protection.”
      • Uncle Sean is reminded of the September speech where SEC Chairman Gary Gensler stated, “Not liking the message isn’t the same thing as not receiving it.”  Yep - LOL!!! 😲
  • The SEC is also proposing changes that would expand current RIA custody rules to include crypto assets – basically requiring companies that hold crypto assets to register as “qualified custodians.”
    • CNBC has a good summary here. 
  • But wait – there’s more!  The SEC has now charged TerraForm Labs with orchestrating a multi-billion dollar crypto asset securities fraud (recall the TerraUSD algorithmic stablecoin collapse that kicked off the crypto winter last year and a string of contagion bankruptcies).

 

• The US FTC ordered Moneygram to pay $115.8M to 40,000 victims of fraud for “failing to crack down on scammers using their payment system” as well as violations of previous settlements from 2009 and 2012 in which Moneygram agreed to take measures to prevent scammers from using its system to defraud consumers.  OUCH!

 

• Notable FinTech funding for the week:
  • Highbeam (eCommerce banking and financing) raised $10M in debt financing.
  • ModernFi (on demand deposit exchange marketplace) raised $4.5M in Seed funding.
  • Sandbox Banking (a low-code integration platform for FIs) raised $4.3M in Seed funding.
  • Comun (Latino focused immigrant banking app) raised $4.5M Seed Round.
  • Check this out!  GrainChain (blockchain enabled agricultural supply chain efficiency platform – yeah you read that right) raised $29M in capital funding to accelerate growth in the US and Latin America.  Per the press release, “The data company sits at the intersection of agtech and fintech with a suite of products that helps facilitate transactions and financing to agricultural players by digitizing the supply chain and reducing counterparty risk.”  For more info go to grainchain.io.
    • Agtech Fintech and counterparty risk - Uncle Sean absolutely loves this!!!!!  😊

 
 
Random Uncle Sean Stuff:

• Congrats to the Kansas City Chiefs for winning Super Bowl LVII in a spectacular come from behind 38 – 35 win over the Philadelphia Eagles.  No disrespect to Jalen Hurts who was AMAZING, but Patrick Mahomes put on a 4th quarter display that proved why he is the MVP.
• We made it to FRIDAY!!!!  Let’s get the weekend going with some Dad Jokes for good measure:
  • Hey Dad, do you know any good jokes about Sodium?  “Na….”
  • New tires are expensive because of….  inflation…  Okay, that one was terrible!!!!
  • All cat owners know that cats can memorize up to 120 commands.  They just don’t want to…
  • Ironically, procrastination is something that you can do immediately….
  • Always remember - beer doesn’t have a lot of vitamins, so you have to drink a lot of it!  😝

 
 
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 2/10/23:
 

• On the heels of the stunning +517K jobs report last week, Fed Chair Jerome Powell stated earlier this week that while the disinflation process has begun, it has a long way to go.
  • Powell stated, “We expect 2023 to be a year of significant declines in inflation. It’s actually our job to make sure that that’s the case,” he said. “My guess is it will take certainly into not just this year, but next year to get down close to 2%.”
    • When the FOMC meets again on March 21-22 (this meeting is also associated with a Summary of Economic Projections), they will have another full month of jobs and inflation data to guide its next rate-hike decision.

 

• A high-five to Computer Services, Inc. (CSI) as they announced Banking-as-a-Service partnerships with ECHO Health, Inc. and MOCA Financial, Inc. via CSI’s prebuilt API platform.
  • In short, if you are a fintech or a financial institution, there is no need to go to the outsourced connector/middleware model when compliant ready regtech solutions are available.

 

• Finzly announced API connection to access FedNow Service instant payment platform launching mid-2023.

 

• Capitalizing on Pay-by-Bank services, Sionic announced the launch of trust-based services for bank-to-bank, Verified Rapid Payments™ to solve for fraud concerns that are prevalent in P2P payments in the U.S. “whether on The RTP® Network or upcoming FedNow™ bank rails.”

 

• It is being reported that Apple is actively beta testing their BNPL offering with their own retail employees, fueling speculation that the product will officially launch soon.

 

• Some big names on the move this week:
  • Stash names Liza Landsman as CEO.
  • Neural Payments welcomes Bill Hampton as CRO.
  • FinWise Bank hires Robert Keil as SVP, Chief Fintech Officer.
  • Pipe announced Luke Voiles as CEO.

 

• On the regulatory crypto front, The Federal Reserve Board issued their final rule stating that banks (regardless if state or national chartered) do not have permission “to hold most crypto-assets, including Bitcoin and Ether, as principal, in any amount,” but can hold them in a custodial capacity “in a safe and sound manner and in compliance with consumer, anti-money-laundering and anti-terrorist financing laws.”
  • Skadden has a really good summary of the Feds recent cautious and restrictive approach related to crypto-assets both to institutions engaged in them and the broader financial system.

 

• Kraken to pay $30M fine and discontinue U.S. crypto staking operations a part of a settlement with the SEC that had accused Kraken of failing to register the service as a security.  CNBC has a good summary.
  • SEC Chief Gary Gensler stated, “Today’s action should make clear to the marketplace that staking-as-a-service providers must register and provide full, fair, and truthful disclosure and investor protection.”
    • Yep….  Uncle Sean is guessing we will see much more of this SEC enforcement now under the precedent of unregistered securities.

 

• The CFPB issued an advisory opinion and a warning to mortgage comparison sites stating if the site “provides enhanced placement or otherwise steers consumers” to certain operators based on compensation, an operator could be in violation of the RESPA section 8.

 

• The U.S. Department of the Treasury released a report this week on the benefits and challenges of cloud services in the financial sector. 
  • The punchline is the need for “more visibility, staff support, and cybersecurity incident response engagement from Cloud Service Providers (CSPs). The report also recommends further evaluation from Treasury and the broader financial regulatory community to continue to determine the financial risks associated with a limited number of providers offering cloud services.”  Oh yeah, good ole fashioned vendor concentration risk… 😲
    • You can read the full 71 page report here - The Financial Services Sector's Adoption of Cloud Services.

 

• Notable FinTech funding for the week:
  • Car IQ (vehicle payments) raised $15M in additional oversubscribed Series B
  • Fierce (neo / challenger fintech app) launched from stealth with $10M in Seed funding.  The Fierce app includes a tiered, interest-earning variable rate dda account earning up to 4.25% APY, a no-fee Mastercard debit card, and SIPC investing in stocks and ETFs.  Crypto trading and the 1.5% cash back credit card are coming soon.
  • Blip Labs (embedded intelligent bill pay platform) raised $2.1M in Seed funding.
  • Nevly Money (credit repair and PFM app) launches with $1.25M in pre-seed funding round.
  • Upwardli (credit builder and savings app) raised $2M Seed Round to help “credit invisibles” quickly establish and build their U.S. credit score enabling access to basic financial services.
  • Canoe (alt investment intelligence platform) $25M in Series B round.

 
 
Random Uncle Sean Stuff:

• It’s SUPER BOWL WEEKEND!!!! 
  • Can we all just agree that Monday needs to be a National Holiday?  C’MON MAN!!!!!
• URGENT PSA - Not sure who needs to hear this, but Valentine’s Day is a mere two days after the Super Bowl…..   You’re welcome!!!
• Because sometimes you just have to laugh, here is a recap of some of the best Chinese (alleged) Surveillance Balloon jokes from this week:
  • NENA – 99… wait, err, I mean…. 98 Luftballons 😝
  • For my Star Wars fans - “That’s no moon…!!!”
  • “The balloon floated from Montana to South Carolina. Somehow it got across the country faster than someone flying Southwest.” — JIMMY FALLON
  • “Just to screw with Fox News, Biden should have announced that he was inviting the balloon to appear in this year’s Thanksgiving Day parade.” — SETH MEYERS
  • Today America took down that Chinese air balloon….  Good to see the current administration fighting inflation.  LOL!!!
  • Maybe the funniest thing I saw (Uncle Sean admits to having an odd sense of humor at times) – you can literally search “Chinese Spy Balloon jokes on TikTok” – yep, TikTok…  Ahhh the irony…  LOL….  😊

 
 
Have a GREAT Super Bowl weekend, a wonderful upcoming Valentine’s Day, 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!!!
 
You can sign up here to have the Uncle Sean Update delivered straight to your inbox every week.  Here is the Uncle Sean Update for 2/3/23:
 

• Shout out to Urban FT (AI-powered mobile imaging and process automation solutions and much more) as the latest innovative company to join the BaaS Association!  Check them out at urbanft.com.

 

• It’s Fed Week!!!  The FOMC voted to raise rates by 25 basis points bringing the Fed Funds Rate to 4.50% – 4.75% and they anticipate that further increases may be appropriate.  While too early declare victory on inflation, Chairman Powell reiterated “over the past year we’ve taken forceful actions to tighten the stance of monetary policy.  We’ve covered a lot of ground and the full effects of our rapid tightening so far are yet to be felt.  Even so, there is more work to do.”  Chairman Powell went on to state, “we've raised rates four and a half percentage points and we're talking about a couple of more rate hikes to get to that level we think is appropriately restrictive.”
  • Here is Chairman Powell’s Press Conference Transcript (24 pgs) and broadcast video (44 min).
  • Next FOMC meeting is scheduled for March 21-22 and will include a Summary of Economic Projections (dot plot).

 

• Meanwhile, the BLS Jobs report came in scalding hot with 517,000 jobs added in January (versus 187,000 market estimate) and an unprecedented low unemployment rate of 3.4% - the lowest since 1969!!!  WOWZA!!!!

 

• Marqeta (Nasdaq: MQ) announced an agreement to acquire Power Finance, Inc. (credit card program management platform) for $223M in cash plus another $52M if certain undisclosed milestones are achieved in the next 12 months.  TechCrunch has a good write-up for more detail as Marqeta continues to expand their product offerings.

 

• SendFriend (B2B cross-border payments) announced an agreement to acquire DigiPli, an onboarding (KYC/KYB) and AML compliance platform.

 

• LevelField Financial, a financial services firm that looks to meld traditional banking and digital assets products into one platform, announced an agreement to acquire Burling Bank (FDIC 27556; $197M Total Assets) pending regulatory approval, of course…

 

• Here is a very cool real-world blockchain use application…  The California DMV announced they will digitize car titles on Tezos blockchain with plans to streamline title transfers as well.  Essentially creating an NFT version of the customers car title that (hopefully) makes managing authenticity and transfers easier (and another use case for digital wallets outside of just cards).  Very exciting!

 

• And more California news - yet another risk aspect for my Ag Banker friends to continue to monitor…  The Colorado River water fight escalated up a notch this week as California split from the other 6 states on a U.S. government deadline to negotiate their own supply cuts or face possible mandatory cutbacks by the federal government.  California receives the largest allocation portion of the water with 80% going to the Golden State’s massive $50B+ agricultural industry.  California has senior water rights and has released its own proposal for water conservation based on the elevation of Lake Mead, setting up a scenario that could potentially end up in the nation’s highest courts if a mutual agreement cannot be met.
  • You can certainly see why CA is flexing their muscle when you look at these Ag statistics from California Department of Food and Agriculture stating “over a third of the country’s vegetables and three-quarters of the country’s fruits and nuts are grown in California.” 

 

• Speaking of flexing – KlariVis announced 218% growth in 2022 including more than doubling their client base and a host of awards and accolades.  NICE WORK!!!

 

• Citizens Bank (FDIC 57957; $226B Total Assets) announced the launch of Zelle® to eligible small business customers enabling near real-time payments (typically within minutes) within the Citizens mobile banking app. 
  • Recall where Zelle for Small Business has been a growth engine with latest results from Q2 2022 showing an 87% quarter-over-quarter increase in disbursement transactions.

 

• Congrats??? 😲 Chainalysis reported that 2022 was the biggest year ever for crypto hacking with $3.8B stolen.  DeFi protocols were by far the biggest victims with the majority of that coming from cross chain bridge vulnerabilities…  OUCH!!!

 

• More CFPB developments worth keeping an eye on:
  • As the CFPB leans into Section 1033 of the Dodd-Frank Act, some small banks and fintechs are asking the CFPB to ease into the elimination of "screen scraping" in favor of APIs stating a sudden ban would “put community banks at a disadvantage and limit consumer choice.”
  • CFPB proposal to reduce CC late fees to $8 from as much as $41, end the automatic annual inflation adjustment for the provision, and cap late fees at 25% of the minimum payment owed by the cardholder.  Impacting as much as $9B per year.

 

• Notable FinTech funding for the week:
  • Moov (full-stack payments platform) raised $45M in Series B $45M in Series B funding.
  • Treasury Prime (BaaS middleware connector) raised $40M in Series C round.
  • Finley (debt capital software – think covenant dashboard, terms, draw requests, etc.) raised $17M in Series A.
  • Wink (biometric identity and payments) raised an additional $3M in Seed investment.
  • Oxygen (personal and business fintech banking app) raised $20M in Series B funding round.

 
 
Random Uncle Sean Stuff:

• It’s official - Punxsutawney Phil emerged from his burrow Thursday morning to let everyone know that there are some documents marked “classified” down there; and then quickly changed the subject to predict 6 more weeks of winter!  Pwahahaha!!!!  😝  Okay – maybe the classified document jokes are starting to get a little stale, but that one was funny!!!
• Well, we survived another Texas Ice Apocalypse this week - although not nearly as bad as the one a few years ago.  Is February too soon to say it’s been a tough year (asking for a friend)??? 😲
• Okay – let’s share some Dad jokes to get us into the weekend with a smile on our face!!!!
  • Why can’t you list “meme lord” as a skill on your LinkedIn profile???
  • Dear IRS, please remove me from your mailing list…  LOL!!!!
  • Remember, it takes guts to be an organ donor (okay, even I cringed a little at that one - 😊)!!!

 
 
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!!!
 
FinTech | Banking | Data, it’s what we do!  It has been a VERY busy week - so let’s get right to it.  Here is the Uncle Sean Update for 1/27/23:
 

• The BaaS Association announced the hiring of Bill Briggs as Chief Executive Officer.  Bill brings a wealth of knowledge and experience having recently served as the Acting Associate Administrator in the U.S. Small Business Administration (SBA) Office of Capital Access where he oversaw all aspects of the historic Paycheck Protection Program (PPP).
  • Briggs stated, “I look forward to working with bankers, financial technology providers, regulators, and lawmakers to outline our priorities as an industry association as we expand Banking as a Service nationwide."
    • ICYMI – check out this Banking with Interest interview with Bill Briggs hosted by Rob Blackwell as Bill discusses his vision for The BaaS Association.

 

• Bankers Helping Bankers announced PULSE® debit network as its exclusive debit partner for the BHB platform providing “debit expertise, insights and thought leadership to help community financial institutions improve their debit programs, strengthen operations, mitigate fraud risks and engage account holders.” 

 

• WHOA – talk about kicking off the new year with some momentum!!!  Congrats to MOCA Financial as they announced the successful launch of three community financial institutions plus three more launching in the next 45 days.  Nice work for the good folks over at MOCA!!!

 

• I love this – Augustana University has partnered with Pathward, N.A. (f/k/a MetaBank) and is launching a financial technology major undergraduate program.
  • For more info, check out the Augustana University Fintech Program by Pathward™.  Very cool!!!

 

• This is pretty big news - the Federal Reserve Board officially announced the denial of application by Custodia Bank, Inc. to become a member of the Federal Reserve System.  Something tells me we haven’t heard the last of this….

 

• The NCUA has been busy over the last few days:
  • Late last week, the NCUA conserved Valwood Park FCU (charter 21788; $28M Total Assets as of Sept call report) due to the all-inclusive “unsafe and unsound practices” doctrine.
    • Sure feels like there is more to this story as Valwood Park is profitable with no real delinquency issues and well capitalized with a Net Worth Ratio of 14.15% (Sep 22).  Maybe the Dec call report will shed more light once they report.
  • This week, the NCUA released Edinburg Teachers Credit Union (charter 66366; $96M Total Assets as of Sep) from conservatorship.  Edinburg Teachers was previously conserved back in Mar 2021.
    • Congrats are in order for hard work and diligence on behalf of the CU employees - being successfully released from conservatorship doesn’t happen very often.

 

• Axiom Bank, N.A. announced they have selected Cable's platform to automate financial crime compliance for Axiom’s fintech sponsor program.

 

• Grasshopper Bank announced a new partnership with MANTL to strengthen the banks online business account opening / deposit origination platform and build out a “fully-automated business online loan origination solution from the ground up.”

 

• Abrigo (compliance, credit risk, and lending platform for FI’s) continues their buying spree announcing the acquisition of DiCom Software, LLC automated credit risk management software.  This is Abrigo’s third acquisition in five months.

 

• The Wall Street Journal reported that the nation’s largest banks plan to launch a digital wallet for consumers and will be managed by Early Warning Services (owned by a consortium of seven banks: JPMorgan Chase, Bank of America, Wells Fargo, U.S. Bank, PNC, Truist and Capital One) to compete with third-party wallet operators such as PayPal and Apple.
  • Worth noting that Apple Pay processed more than $6T (yes, trillion with a T) in annual transaction volume last year – surpassing Mastercard.  😲

 

• Grupo Coppel, Mexico’s largest department store, announced the launch of Coppel Access offering immigrant friendly U.S. mobile banking services to those in the U.S. including FDIC insured accounts via Community Federal Savings Bank using an official Mexican or U.S. ID.

 

• Marqeta announced the promotion of Simon Khalaf to CEO.

 

• 😊 Sing it with me “Money, Money, Money - Money!!!” (credit: The O'Jays - For The Love of Money)!!!  Check out the flood of FinTech funding for the week:
  • Grazzy (employee instant tip payments platform) raised $4.25M Seed Round.  TechCrunch has a good write-up.
  • DailyPay (on-demand wage/EWA platform) raised $260M in capital consisting of an additional $160M capacity for their revolving credit facility plus a $100M term loan.
  • PayEm (business procure to pay platform including corporate cards) $220M in Capital consisting of equity and credit financing.
  • Vartana (sales closing and financing platform) raised $12M in Series A funding round.
  • Sandbar (AML software for fintechs) raised $4.8M Seed round.
  • Zurp (creator/influencer loyalty fintech card platform) raised $5M in pre-seed funding to continue building out their creator partnerships and expand the company’s offerings to include banking options, as well as different tiers of credit cards.
  • Tranch (B2B BNPL) raised $100M in capital in an undisclosed mix of equity seed round and debt.
  • Inscribe (fraud detection and credit analysis for FI’s and fintech companies) raised $35M in Series B funding round after experiencing 3x increase in ARR over last year.
  • Method (API-based infrastructure for consumer loan payments, balance transfers, bill pay, etc.) raised $16M in Series A round.
  • Foro (commercial lending startup) emerged from stealth with $8M in Series A funding to democratize access to capital for SMB’s.

 
 
Random Uncle Sean Stuff:

• The NFL conference championship games are this Sunday with the winners to play in Super Bowl LVII on February 12 in Glendale, AZ! 
  • NFC: San Francisco 49ers at Philadelphia Eagles - 2 PM CST on Fox.
  • AFC: Cincinnati Bengals at Kansas City Chiefs - 5:30 PM CST on CBS.
    • I don’t mean to incite a riot (or in this case a “chicken-run” LMAO), but if you are planning on cooking chicken wings for Sunday, you should probably stock up NOW!!!!
• I tried this recipe out this week and it is a winner.  Super easy and definitely worth sharing – Grilled Hawaiian Teriyaki Chicken (FYI you can double this recipe just by X2 all ingredients):
  • 1 ½ pounds of boneless, skinless chicken thighs
  • 1 cup low sodium soy sauce, 1 cup brown sugar packed, 1 cup pineapple juice, 4 cloves garlic either minced or chopped, 1 TBSP fresh minced ginger (this is your standard teriyaki marinade)
  • Mix the teriyaki marinade until the sugar dissolves.  Then put the chicken in a gallon baggie and pour the marinade over the chicken.  Press the air out of the bag and tightly seal as air-tight as possible.  Refrigerate overnight.
  • Remove chicken from the bag (do NOT discard marinade).  In a saucepan, bring marinade to a simmer for 5-10 minutes.  Grill chicken until done.  Place grilled chicken in a baking dish and pour remaining hot marinade over the top – serve immediately.
    • As a side note – I used the leftover chicken the next day as a lean protein salad topper and it was AMAZING!!!!
• Just for the record, Uncle Sean has no classified documents in the garage (LOL)…  But I can’t speak for Aunt Patty – Lord only knows what she has stashed away out there!!!  😝

 
 
You can sign up here to have the Uncle Sean Update delivered straight to your inbox every week.  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.