TheStreet Search RSS Feed: Lauren Tara LaCapra

Bank Dividend Decision Appears Imminent

Fri, 11 Mar 2011 14:51:24 EST

WASHINGTON (TheStreet) -- The Federal Reserve is expected to approve dividend hikes for big banks like Wells Fargo and JPMorgan Chase within the next couple of weeks.

The 19 largest U.S. banks were required to provide the Fed with detailed capital plans in January, and then incorporate a "stress test" of how banks would perform under various economic scenarios. The Fed would then approve the banks' plans, or advise them on changes, after which time the firms would be allowed to announce higher dividends.

Several big banks, including Wells, JPMorgan, U.S. Bancorp , State Street and Bank of New York Mellon have been itching to raise their dividends for months and are widely expected to be among the first to announce those plans. ...

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AIG: Financial Winner

Fri, 11 Mar 2011 12:35:59 EST

NEW YORK (TheStreet) -- Financial stocks were up marginally on Friday, with big banks' pushback against tough reform measures and American International Group's continued progress towards independence dominating the chatter on Wall Street.

The KBW Bank Index was up 0.6% at 52.35 by noon, better than broader market indexes, which were wavering as oil prices dropped sharply and investors assessed how the massive earthquake in Japan would impact the markets.

Meanwhile, AIG was grabbing headlines for offering the Federal Reserve $15.7 billion to buy back a big bundle of toxic debt that the Fed has been holding since AIG's bailout in the fall of 2008. It also plans to name two new directors, John H. Fitzpatrick and W. Don Cornwell, to its board of directors, according to a report. ...

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Wells Fargo Searching for Broker Buy

Fri, 11 Mar 2011 11:03:30 EST

SAN FRANCISCO (TheStreet) -- Wells Fargo appears to be on the hunt for another brokerage acquisition in the latest sign that wealth management has become the sweet spot for big U.S. banks.

In an interview with the Wall Street Journal, CEO John Stumpf said that Wells Fargo's wealth and retirement business is "suboptimized" and that he intends to grow the business as quickly as possible.

"If we could jump a curve with the right deal, that's great," Stumpf said, according to the paper. ...

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Bank of America Expands Military Mortgage Aid

Thu, 10 Mar 2011 16:10:23 EST

CHARLOTTE, N.C. (TheStreet) -- Bank of America extended more generous mortgage terms to U.S. military customers on Thursday. The move comes after a big-bank competitor received heated criticism for having overcharged and improperly foreclosed upon service members.

Bank of America will offer a reduced 4% interest rate to service members who are eligible for mortgages under the Servicemembers Civil Relief Act, forgive principal for military borrowers who are behind on payments when they leave active duty and extend mortgage protections that are offered to active military to those who have left the service as well.

"Military men and women face extraordinary circumstances, and they make unique sacrifices for all of us," Terry Laughlin, an executive in charge of the Bank of America division that handles troubled mortgages. "For these reasons, we want this combination of tools to address their needs and help them when they need it most." ...

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Barclays, Deutsche Need Capital: Spain

Thu, 10 Mar 2011 12:19:25 EST

MADRID (TheStreet) -- Spain's central bank has ordered 12 lenders, including Deutsche Bank and Barclays , to raise 15.15 billion ($20.9 billion) in fresh capital to cover potential losses, as the country continues to grapple with sharp declines in real estate value.

The Banco de España unveiled the results of its stress test on Thursday, which analyzed the financial condition of dozens of banks and whether they ought to increase the amount of capital they have on hand. Only two of the banks subject to the stress test were Spanish.

Those needing to raise capital were mostly small lenders, including the savings banks Bankia, Base, Cívica, Mare Nostrum, Catalunyacaixa, Novacaixagalicia, Unnim and Caja España de Inversiones, in addition to bigger commercial lenders Bankinter, Bankpyme, Barclays and Deutsche Bank. ...

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AIG Adopts Poison Pill to Shield Tax Break

Wed, 09 Mar 2011 17:22:42 EST

NEW YORK (TheStreet) - American International Group is trying to prevent anyone from acquiring significant ownership stakes in order to protect lucrative tax breaks in the future.

In an announcement on Wednesday, the New York-based insurer said it has adopted a plan to discourage investors from acquiring 5% or more of its common stock. The move comes as AIG prepares for the U.S. government to begin unloading 1.65 billion common shares in smaller tranches in the coming months.

"This Plan is designed to protect AIG's valuable tax assets by reducing the likelihood of an unintended 'ownership change' through actions involving AIG's securities," Chairman Steve Miller said in a statement. "The Plan is particularly important as the U.S. Department of the Treasury begins to reduce its position in AIG." ...

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Morgan Stanley Plans to Let Go 'Hundreds' of Brokers: Report

Wed, 09 Mar 2011 15:46:09 EST

NEW YORK (TheStreet) -- Morgan Stanley is reportedly firing hundreds of poorly performing brokers and trainees as the investment banking giant continues to sharpen the edges of its wealth management division.

According to a Reuters report, Morgan is planning to let go of 200 to 300 staffers, which represents less than 2% of its year-end total of about 18,000. The company will still have the largest brokerage force on Wall Street, due to its Smith Barney joint venture with Citigroup .

>>>Read More: Morgan Stanley Mulls Smith Barney'less Future ...

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Wells Fargo CEO Bashes Bank Rules

Wed, 09 Mar 2011 09:48:03 EST

MINNEAPOLIS (TheStreet) -- Wells Fargo CEO John Stumpf issued perhaps his bluntest criticism of new bank regulations in a speech and Q&A session on Tuesday in his native state of Minnesota, saying "government price controls" have put an undue burden on his industry. Wells Fargo CEO John Stumpf.

Stumpf, who leads the country's fourth-largest bank and second-largest mortgage servicer, also issued grim predictions for the housing market and income inequality if lawmakers don't set better policies going forward.

He was particularly critical of new rules related to debit and credit cards that will hinder banks' ability to charge fees, raise interest rates and manage risk. A proposal by the Federal Reserve related to debit-card interchange fees that banks charge merchants will cut it a level of to 12 cents per swipe, down 72% from the typical 44 cent per swipe fee they now charge, according to research firm R.K. Hammer. ...

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AIG Pays Uncle Sam $6.9 Billion

Tue, 08 Mar 2011 16:42:58 EST

NEW YORK (TheStreet) -- American International Group said Tuesday that it repaid about $6.9 billion to the U.S. Treasury Department as the insurance giant continues to make progress on exiting the large, complex array of bailouts it entered during the financial crisis.

AIG made the payment after closing on an earlier announced sale of MetLife stock that it received as part of a divestiture last year. AIG received $9.6 billion from the MetLife stock transaction, a portion of which is being held in an escrow account.

With its latest repayment, AIG has returned most of its $180 billion worth of borrowings and credit lines from taxpayers, including $36 billion worth in 2011. The company extinguished its debt to the Federal Reserve, though the Treasury Department still has an $11.3 billion stake in a special vehicle backed by equity in AIA, another business AIG divested last year in a public offering. It will also have a 92% equity stake in AIG to be sold over time. ...

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Morgan Stanley Mulls Smith Barney'less Future

Tue, 08 Mar 2011 15:22:27 EST

NEW YORK (TheStreet) -- Morgan Stanley will have to tread carefully in the post-crisis, anti-Wall Street era if it plans on dropping the Smith Barney brand. Actor John Houseman became synonymous with Smith Barney for the famous tag line, "We make money the old fashioned way. We earn it."

Morgan Stanley is in the midst of acquiring the retail brokerage giant from Citigroup . The white-shoe investment banking firm is therefore making a big bet on the profitability of small-fry investors -- in stark comparison to the institutional and corporate clients on which it has built a solid reputation over the past 75 years.

It's an ironic twist in the long history of Morgan Stanley, which itself was once part of J.P. Morgan. Those franchises split in 1935, due to a post-Depression rule that didn't allow commercial banking and investment banking to exist under the same roof. ...

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Citi Considers Partial Sale of OneMain: Report

Tue, 08 Mar 2011 14:59:05 EST

NEW YORK (TheStreet) -- Citigroup may retain a minority stake in its consumer finance business rather than sell the entire franchise as initially planned, according to a news report.

The business, once known as CitiFinancial but rebranded as OneMain Financial, has about $13 billion in assets and may deliver as much to Citi in a sale. There are several groups of investors, including a bank and several big private equity firms, reportedly bidding on the business.

On Tuesday, Reuters cited anonymous sources who said Citi may retain a stake in the unit and is offering partial financing to interested bidders. ...

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Financial Loser: Fifth Third

Mon, 07 Mar 2011 16:21:18 EST

NEW YORK (TheStreet) -- Financial stocks slid again on Monday - with regional names like Fifth Third Bancorp getting hit particularly hard - as higher oil prices weighed on investors' expectations for the economic recovery.

In late-afternoon trading, Fifth Third closed down 2.2% at $13.59. Regional competitors were also losing ground, with Huntington Bancshares down 1.7% at $6.54, People's United down 2% at $12.42 and SunTrust Banks down 1.7% at $28.91.

Oil prices closed above $105 per barrel on Monday, with gasoline topping $3.50 per gallon. The price hikes were driven by concerns about unrest in the Middle East. Banks are particularly sensitive to the effect of petroleum prices, since paying more for energy can curb economic activity. ...

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Wells Fargo Hiring 1,000 Staffers

Mon, 07 Mar 2011 15:16:24 EST

SAN FRANCISCO (TheStreet) -- Wells Fargo said Monday that it will hire more than 1,000 tellers and bankers by mid-May as it expands operations in the Mid-Atlantic area.

The hires will be made in Virginia, Maryland and Washington, D.C., to staff up retail banking at locations within its Wachovia footprint. The move comes ahead of the conversion of Wachovia branches into the Wells Fargo brand during the fall.

"It's critical that we are fully staffed with enthusiastic, skilled team members in our banking stores," Pete Jones, Wells Fargo regional president for the Mid-Atlantic region, said in a statement. "We also hope that, by adding over 1,000 new team members in the next three months, we'll be contributing to the economic recovery in Virginia, Maryland and Washington, D.C." ...

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Bank 'Rep-Pricing' Has Mixed Results: Report

Mon, 07 Mar 2011 13:36:57 EST

NEW YORK (TheStreet) -- JPMorgan Chase appears to be halfway done with implementing new fees on depository accounts to make up for lost revenue - ahead of big-bank competitors, according to an analysis released on Monday.

But, ultimately, the industry at large may only be able to recoup 35% to 40% of an estimated $25 billion in fees it once collected from debit and credit card use. Additionally, the implementation of new fees will take time, with Nomura analysts led by Glenn Schorr and Brian Foran characterizing fee recovery as a "slow burning issue" in 2011.

In a report on Monday, the Nomura team performed some back-of-the-envelope calculations to assess how much of that revenue the industry could recover by adding new fees and how far along some big banks are in the process. ...

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Regulators Push Foreclosure Crisis Solution

Mon, 07 Mar 2011 11:22:12 EST

NEW YORK (TheStreet) -- Federal and state authorities have banded together to give large banks a detailed proposal for how to handle loan servicing and foreclosures, though experts expect another 3 million Americans to lose their homes before the housing market recovers.

The 27-page document was given to mortgage servicers last week and sought "a binding legal requirement," a spokesman for Iowa Attorney General Tom Miller told Bloomberg. The proposal is separate from monetary penalties that federal and state authorities plan to seek.

The move comes months after a scandal erupted over big banks' practice of "robosigning," in which employees would sign off on thousands of foreclosure affidavits without properly vetting the material. Widely publicized cases led Ally Financial, Bank of America , JPMorgan Chase , Citigroup , Wells Fargo to review processes and, in some cases, temporarily halt foreclosure proceedings. ...

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