Bank of America to End Overdraft Fees on Debit Cards
This is great news and I applaud BofA for taking to the essence of the credit card reform bill and ended this predatory type of fee. Even myself, was under the impression that the reason we enter our pin number for debit purchases was to authorize a purchase and at that moment the terminal checked to make sure sufficient funds were in the account before running the transaction. I learned this was not the case and realized that a debt card holder could be charged thousands of percents of interest for the smallest transaction based on the fee that was charged on an annual basis. I hope to see more banks step up and do away with these fees and focus more on core banking tasks and true financial innovation to produce profits and value.
New York Times - In a move that could bring an end to the $40 cup of coffee, said on Tuesday that it was doing away with overdraft fees on purchases made with debit cards, a decision that could cost the bank tens of millions a year in revenue and put pressure on other to do the same.
Popularity: 1%
BofA modifies 12,700 mortgages under government HAMP program
Good to hear some homeowners are getting a reduction in their mortgage through the HAMP program. Problem is they need to really ramp it up because a total of 25,000 homeowners are a drop in the bucket. Still it is good to see some movement with BofA on trying to address these underwater mortgages to give the borrowers incentive to stay in the home.
Reuters - Bank of America has permanently amended home loan terms for more than 12,700 borrowers under the Obama administration’s main mortgage modification program, the bank said on Tuesday.
Popularity: 1%
Goldman Sachs Posts Nearly $5 Billion In Profit While Restrains Compensation In Q4
Quite a good quarter for the Goldman Sachs boys. With the amount of bailout they got through AIG via the treasury, you better be able to make money. We have a huge swing in the markets in 2009 and GS was flush with cash and was able to deploy it and ride the wave up. I do like they are trying compensation packages to stocks and not cash so the employees goals are aligned with long-term profitability of the firm.
I personally have no problem with a investment bank being profitably, but if we are going to have them unregulated, we need to let them fail when they get to greedy and lets them be rewarded by our markets when they are more clever than the rest, THAT is real capitalism.
New York - Dow Jones - Goldman Sachs Group Inc. (GS) on Thursday delivered its richest quarterly profit in the investment bank’s 140-year history, driven in part because it restrained compensation amid a public outcry about excessive pay.
Popularity: 1%
Bank of America Posts Loss of $5.2 Billion After Firm Repays Bailout
The market sold off strong today on 3 big banks (Wells, Morgan and BofA) all reporting losses and increasing of loan loss reserves. This throws a wrench in the whole recovery picture and brings uncertainty into the market which creates volatility. Goldman Sachs reports tomorrow and that will be very important, if they post huge losses then it will weigh on the markets and we could see the real correction everyone has been talking about coming true.
Bank of America Corp., the largest U.S. lender, posted a quarterly loss and its first full-year deficit in more than two decades, driven by the cost of repaying U.S. bailout money and defaults on consumer loans.
Popularity: 1%
BofA hires Brian T. Moynihan as new CEO
Looks like the board of directors went with an insider for the new top office job with Mr. Moynihan. I assumed they would go with a Bank of America company man over bringing in an outsider to be their new Chief Executive Officer. They really need someone who knows the culture inside and will have an overview of the operation so they can integrate their aquasitions into the larger brand and knows what units don’t work for their strategy so they can sell them off and reduce operational costs.
Wall Street Journal - Bank of America Corp. promoted Brian T. Moynihan to president and chief executive, ending an 11-week search with a unanimous boardroom vote in favor of a longtime insider.
Popularity: 1%
Wells Fargo to buy Prudential’s joint-venture stake For $4.5 billion
(Dow Jones) Wells Fargo & Co. said Tuesday it will buy out Prudential Financial Inc.’s (PRU) stake in its retail brokerage joint venture for $4.5 billion in cash, a move that comes a day after the bank said it would repay $25 billion in government bailout money.
San Francisco-based Wells Fargo will acquire Prudential’s non-controlling stake in Wells Fargo Advisors LLC, the joint venture, before the end of the year, the two companies said in a press release announcing the deal. The deal comes more than a year after Prudential, one of the country’s largest insurers, publicly announced its intention to divest its stake.
Popularity: 1%
Citigroup to repay $20 billion of bailout funds
Well its a race to from under the “Pay Czar” and now Citibank is running as well so they can pay bonuses as well. I guess the bonus race is on these days. My question is if the government will be removing its $300 billion in guarantees for Citigroup loans and securities? If that is not withdrawn then is it clear that they are not from under the TARP program and they should still be under those pay constraints.
It is already bad enough that the U.S. taxpayers has bailed out and provided a backstop for our banking institution but now we are not seeing any real “thanks” for that gesture and more focus on getting clear of the rules that were setup so they can get paid before Christmas. Don’t be too dis-trot, this is greed working its magic, we setup the rules and they are following them so next time if we are satisfied with them, then we need to write better rules and that starts with people intelligently engaging their representatives so your voice and opinion is heard and taken seriously.
Education is the key in complex matters like finance and economics and that means you need to take some of your leisure time and dedicate it to learning about these matters if you want a different outcome than what we have gotten this far. That is a main reason I write this blog is to educate and force myself to be current by reading news on these subjects everyday.
Popularity: 1%