Uncle Sean's Update - 6/18/21

Happy Friday!!!
 
Happy Father’s Day Weekend to all the Dad’s!!!!!  Here is the Uncle Sean Update for 6/18/21:
 

• It’s Fed Week!!!!  Spoiler alert – nothing happened (again)….  Rates remain unchanged and the $120B per month bond buying continues.  Nonetheless, Uncle Sean still geeks out on Fed Week every single time (I think it’s a Pavlov’s Dog type of thing for me – like when you hear the ice cream man coming down the street), I just can’t help myself!!!  In regard to tapering the bond buying program, Powell said “You can think of this meeting that we had as the ‘talking about talking about’ meeting” – so we are still a ways off.  Inflationary pressures are creeping up and the estimated timeline for potential interest rate hikes has accelerated to “maybe” 2023.  CNBC has a good summary as always.  If you want to channel your “inner Uncle Sean geek” here is the FOMC statement and the detailed Summary of Economic Projections.

 

• I’m sure you saw it all week as did I….  The endless articles about Amex launches small business checking account….  I think all of the journalists forgot that Amex is, in fact, a bank; and surprisingly (sarcasm), banks sometimes offer checking accounts – LOL!!!  A quick look at the FedFis Bank database (yes, that’s a shameless plug) shows that Amex has about $3 Billion in DDA accounts.  Secondly, it’s not Amex – it’s Kabbage that has the business banking account (Amex acquired Kabbage last year) and they have had that product since July 2020.  So nothing new here folks…

 

• The Senate confirmed big tech critic and prominent antitrust scholar Lina Khan as Chair of the FTC.

 

• Discover (a name that sometimes gets unfairly overlooked in the credit and payment arena) has signaled strategic interest in the crypto world by hiring Alexandra Prodromos for the newly created position of Product Manager of Blockchain and Digital Currency.  Payments Dive has a good write-up here.

 

• Check out Cross River Bank – these guys are a cutting edge Sponsor Bank and now they have launched a venture capital arm appropriately called Cross River Digital Ventures to invest and propel the next generation of fintech startups and technology pioneers.

 

• Stripe launches Stripe Identity in the red hot online ID authentication space. 

 

• Velocity Solutions announced that CIBC Bank has selected Velocity's digital lending platform (Akouba) to support CIBC’s small business banking division.

 

• Former PayPal executives launch Six Clovers, a decentralized cross-border payment network designed to connect banks, merchants, and payment providers to transact in digital currencies around the world by taking direct aim at Swift.

 

• Verizon is now a fintech challenger bank (it just feels weird to say that out loud) as they announced the launch of Verizon Family Money mobile app with a prepaid GPR Visa debit card powered by Galileo and issued by Metropolitan Commercial Bank including a savings vault with the goal of creating financial literacy to kids.

 

• Bank M&A activity is really picking up!  A quick look at the FedFis M&A database (yep – another plug) shows 18 deals for June through June 18th including another credit union acquisition of a bank – see Lake Michigan Credit Union to acquire Pilot Bank of Tampa, Florida (which is Lake Michigan CU’s second acquisition of a bank).  Also of note is the recently announced Liberty Bank acquisition (Utah ILC) by the fintech KMD Partners (the parent company of CreditNinja that offers high-cost personal loans ranging from 25% to 249%) – and is sure to draw criticism from consumer advocates in relation to the True Lender Rule and state usury laws.

 

• Adyen (payment processing platform) gets a US Charter as a Foreign Bank Branch allowing them to operate in the US as a bank.  This is interesting as it allows another entrance by a fintech (Adyen has a European Bank license) into the US banking system.  In this same context, take a look at Credijusto – the first Mexican Fintech to Acquire a Regulated Mexican Bank, Banco Finterra.  I wonder if they will be next to apply for a Foreign Bank Branch charter to operate in the US…???  If this becomes a new path for fintech entrants, then it certainly points towards a U.S. de novo process that is way too difficult.

 

• Wise (fka TransferWise) formerly announced plans to go public via direct listing on the London Stock Exchange.

 

• Funding continues to flow:
  • Unit (BaaS fintech) raised $51M in Series B funding round.  Valuation was not disclosed, but total funding to date is just shy of $70M.  Unit also and announced the upcoming launch of Unit Go (coming this fall) that will allow companies to create live bank accounts and issue physical and virtual cards in minutes. 
  • Nymbus CUSO raised $5M Funding Round led by Curql.
  • Splash Financial (digital lending platform) raised $44M in Series B funding round.
  • Novo (neo business bank) raised $40.7M Series A funding round.
  • Hello Alice (business capital firm) raised $21M in Series B round.

 

• And last but certainly not least (this is just too good not to share), Joe Exotic aka “The Tiger King” announces NFT auction from prison!!!!  So far the future is everything I had hoped it would be – LMAO!!!!

 
 
Random Uncle Sean Stuff:

• Happy Father’s Day to all the Dad’s – now get out there and mow / fertilize the yard, change some light bulbs, wash the cars, and bbq / grill a huge meal for everyone on your day of recognition - LOL!!!!  All kidding aside, we are planning a family fish fry (including my favorite - homemade onion rings) this Sunday and I am very excited!!!!

• Aunt Patty and I made a crock pot roast this week that was fantastic!!!  It was my late Grandma Teeny’s recipe (her name was actually Ernestean, but none of us could pronounce that when we were little).  Place 4 beef bouillon cubes in the bottom of the crock pot, add sliced carrots and a few small whole onions, drop in about a 3lb or so chuck roast (whatever fits), pour in 3 or 4 cans of Coke (however much you need to cover the roast), and cook on low for 6 – 8 hours.  I know it sounds weird, but the acidity in the Coke tenderizes the roast and it tastes amazing.  You’ll know it’s done when you can twist a fork in it and the roast pulls apart easily.  We served it with homemade mashed potatoes and gravy.  ENJOY!!!!!!

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