Uncle Sean's Update - 5/12/23

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

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 
 
Random Uncle Sean stuff:

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

 
 
Have a GREAT MOTHER’S DAY WEEKEND and please stay safe!!!
 
Uncle Sean
 
 
Sometimes known as Sean Mayo – contact me directly for scope and pricing of custom reports / analysis projects at [email protected] | 214-604-6961 – or you can contact FedFis Sales Team at 512-960-0911 | [email protected] #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.