What’d I miss? News and Insights that got noticed

Key themes this week (April 28- May 4)

• JPMorgan assumes deposits from First Republic Bank
• Apple drew $1 billion in deposits within a week
• SoFi’s Membership Rosters Surge 46% Year on Year
• Former Amex execs start early stage fintech fund

First Republic Bank Is Seized, Sold to J.P. Morgan in Second-Largest U.S. Bank Failure

"...JPMorgan said it will assume all of First Republic’s $92 billion in deposits—insured and uninsured. It is also buying most of the bank’s assets, including about $173 billion in loans and $30 billion in securities.”

Key takeaways:

• As part of the agreement, the Federal Deposit Insurance Corp. will share losses with JPMorgan on First Republic’s loans
• The agency estimated that its insurance fund would take a hit of $13 billion in the deal. JPMorgan also said it would receive $50 billion in financing from the FDIC

LinkedIn Post

Mastercard ‘cannot afford to ignore’ AI, CEO says

"...Internally, generative AI “might be a good solution for us when it comes to customer service propositions and so forth,” Miebach said during Mastercard’s first quarter earnings conference call with analysts. He added that the company is “actively engaged on that” idea.”

Key takeaways:

• Still, as the technology poses opportunities and risks, Mastercard’s application of AI needs to be done carefully, Miebach said. “We approach data privacy in a principled way, we approach the crypto space in a principled way, and the same thing applies here,” he said."
• As the technology has evolved rapidly, so have potential uses of it, which has inspired companies to explore how they can employ generative AI

LinkedIn Post

Former Amex execs raise $78M for early stage fintech fund

"...The firm is founded by three former managing directors of Amex Ventures, Dana Eli-Lorch, Lindsay Fitzgerald and Julia Huang. The trio’s goal for Vesey is to give its portfolio companies a competitive edge by offering access to its diverse network at an early stage."

Key takeaways:

• We identify innovative, actionable business development ideas designed to shape a company’s go-to-market strategy and meaningfully move the needle for them,” Fitzgerald told Banking Dive via email.
• “We only invest in startups that we believe we can meaningfully support through our experience and our network, both of which are financial services-centric. Any startup that can benefit from that network is fair game.”

LinkedIn Post

SoFi’s Membership Rosters Surge 46% Year on Year

"…Earnings materials show that during the quarter, the company added 433,000 members, bringing the total membership base to 5.7 million, up 46% year on year.”

Key takeaways:

• The company said that its personal loan originations were up 46% to nearly $3 billion
• SoFi CEO Anthony Noto said that “more than 90% of our consumer deposits are from sticky direct deposit members, and 97% of our deposits are insured.”

LinkedIn Post

Amazon Pay rolls out Citi Flex Pay to give credit card users instalment option

“…Citi credit card holders can now pay in instalments when using Amazon Pay during checkout at thousands of online shopping sites.”

Key takeaways:

• The new payment option brings Citi's Flex Pay BNPL option to a digital wallet for the first time
• Eligible Citi credit card members can select three to 48 month payment plans for purchases of $50 or more. Monthly payments are included in a cardmember’s minimum monthly payment due at the end of each billing period

LinkedIn Post

Revolut goes live in Brazil

"...Revolut's global account will offer locals foreign exchange and remittance capabilities in 27 currencies, in addition to having a card that is accepted in more than 150 countries.”

Key takeaways:

• Glauber Mota, recruited from BTG Pactual to lead the roll out in Brazil, comments: “The total that Brazilians spent abroad more than doubled in 2022, totaling $12 billion, and there is growing demand for access to crypto assets with more than ten million individual investors in Brazil.
• Revolut offers Brazilians an app that meets all these needs in one place, with a high-quality UX that has not yet been seen in the Brazilian market."

LinkedIn Post

Shopify taps B2B payments platform Melio for bill pay solution

“…Through the new solution merchants operating on Shopify will be able to pay bills via credit, bank or wire transfer, as well as choose how their vendors will receive payments separately (by check, bank or wire transfer), without having to leave the Shopify platform.”

Key takeaways:

• With Melio supporting payments to 100 countries, merchants will be able to pay invoices “for everything” including inventory, shipping and advertising, both within the US and abroad."
• Both firms claim that Shopify Bill Pay saves merchants an average of 16 hours a month on paying bills, claiming it to be “2x faster” than other B2B expense management solutions

LinkedIn Post

To Capitalize on Home Equity Opportunity, Go Beyond Credit Scores

"...Credit is definitely back in style, with credit card and personal loan volumes rising, according to Ken Flaherty, senior consumer market analyst at Curinos.”

Key takeaways:

• Prices have been rising across the board at the same time that stimulus funds have finally been spent and people are beginning to eat into their savings or are already tapping available credit, he says.
• The banking industry saw “really robust origination growth” in home equity lending in 2022, but demand has subsided somewhat in 2023 so far, Flaherty says. Beyond that, actual usage levels of home equity credit lines have been “pretty lethargic” compared to the number of open accounts."

LinkedIn Post

How Capital One is democratizing machine learning to curb fraud

"...ML tools keep humans focused on the tasks that require their attention, prioritizing resources through technology. Artificial intelligence capabilities are finding a role in financial services in particular.”

Key takeaways:

• Four in five companies in the sector have up to five AI use cases at work in their organization, according to an NVIDIA report published in February. Nearly one-quarter are using AI to help detect fraud."
• The top barriers are security and privacy concerns and the black-box nature of AI systems, as well as the absence of internal AI know-how, AI governance tools and self-service AI and data platforms

LinkedIn Post

Apple drew $1 billion in deposits within a week of savings account launch

"...The long-trailed Apple Card savings account from Goldman Sachs was launched in Mid-April with a headline-grabbing 4.15% annual percentage yield - more than 10 times the national average, according to Federal Deposit Insurance Corporation (FDIC) data.”

Key takeaways:

• According to internal sources cited by Forbes, the consumer technology giant racked up $990 million in deposits in less than a week. In that time, 240,000 accounts signed up for the service
• The arrival of Big Tech giants in financial services has banks and regulators rattled

LinkedIn Post

Greenwood acquires neobank Kinly

"...Greenwood, a fintech that provides banking services to Black and Latinx communities, acquired fellow affinity neobank Kinly for an undisclosed amount, Greenwood announced Tuesday.”

Key takeaways:

• The acquisition merges two neobanks that share a similar mission. Both fintechs launched in 2020 with the goal to help underserved communities build generational wealth
• Greenwood said the deal adds 300,000 Kinly community members to the Atlanta-based firm’s platform

LinkedIn Post

Toronto-Dominion Bank, First Horizon Terminate Merger Agreement

"...Banks cite regulatory hurdles in canceling $13.4 billion deal.”

Key takeaways:

• Regional-bank stocks tumbled Thursday morning despite assurances from the Federal Reserve that the banking system is on solid footing
• TD and First Horizon didn’t discuss extending the timeline for the deal, lowering the price, or changing its structure, said Bryan Jordan, First Horizon’s CEO

LinkedIn Post

Check this out:

[Live Webinar] Leveraging Tech to Streamline Loan Processes in a Volatile Economic Climate

“…A panel of experts will share their insights and experience on how banks should leverage digital technology to improve customer service, reduce loan processing time, and increase efficiency while minimizing risk to improve the overall loan origination and servicing customer experience.”??

Register here:?https://lnkd.in/e-JwiVdq

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