Latest news with #BankingDive
Yahoo
2 days ago
- Business
- Yahoo
Blockchain firm, NJ county ink deal to digitize $240B of deeds on-chain
This story was originally published on Banking Dive. To receive daily news and insights, subscribe to our free daily Banking Dive newsletter. A deal inked between a blockchain firm and one of the nation's most densely populated counties will result in the digitization of 370,000 property deeds worth $240 billion in real estate value, marking what the entities call the largest blockchain-based deed tokenization project in U.S. history. Balcony, utilizing the Avalanche blockchain, will create a fully digitized ledger of titles across Bergen County, New Jersey's 70 municipalities, in a five-year partnership aimed at reducing fraud, title disputes and administrative errors. 'For generations, the deed and property records to your home have been stored in fragile and disparate databases, vulnerable to tampering, ransomware and fraud that is no longer acceptable,' said Balcony CEO Dan Silverman at a press event Wednesday morning. 'Many of the systems used today to manage property records were built before I was born. They weren't designed for the threats of today's world,' Silverman said. 'Sophisticated cyber criminals target state systems with ransomware attacks that cost taxpayers tens of millions of dollars annually, and now, with the rise in generative AI, fraudulent documents can be fabricated in seconds, completely indistinguishable from the real thing.' That's where blockchain technology comes in, moving all of the information to an immutable, searchable ledger and cutting deed processing time by 90%, Silverman said. John Hogan, who has served as Bergen County clerk since 2012, said in a prepared statement that the initiative is about improving the lives of Bergen's residents by simplifying and securing the recordkeeping process. 'We can't be afraid of new technology. I kind of think that those who were here before me were afraid of new technology, because when I came here, there was Post-It notes, there was mimeograph stuff …I think the place was stuck in time,' Hogan said Wednesday morning. 'This is a great step forward for our office and for our county and for the people we serve.' When Balcony's digital asset registry is completed, Hogan said any resident will be able to trace the history of their property from beginning to current on the registry. Blockchain technology stands to revolutionize 'any process that relies on trust, transparency, and secure recordkeeping,' well beyond deeds, according to Chief Strategy Officer Luigi D'Onorio DeMeo at Ava Labs, the creator of the Avalanche blockchain. 'We're seeing major potential in areas like identity verification, supply chains, licensing, and financial settlement. These systems are often outdated, siloed, or paper-based. Blockchain brings a shared, tamper-proof source of truth that can drastically reduce fraud, delays, and administrative costs,' he said in an emailed statement to Banking Dive. Bringing real-world assets on-chain is a step toward a more efficient economy, he wrote, allowing programmability, fractional ownership, and global liquidity across things like property, commodities, or financial instruments. 'That means more people can access and interact with markets that were previously gated – unlocking new business models and financial inclusion at a global scale,' DeMeo said. Outside of Bergen County, Balcony is working with several other municipalities in New Jersey and beyond to modernize government real estate systems, according to the press release. In Orange, New York, Balcony uncovered nearly $1 million in lost municipal revenue, according to a press release seen by Banking Dive. The revenue was previously hidden due to 'incomplete or outdated records.' Sign in to access your portfolio
Yahoo
2 days ago
- Business
- Yahoo
Circle files for IPO
This story was originally published on Banking Dive. To receive daily news and insights, subscribe to our free daily Banking Dive newsletter. Stablecoin issuer Circle Internet Group filed S-1 paperwork with the Securities and Exchange Commission Monday for an initial public offering. The New York-based fintech intends to raise $624 million through the sale of its 24 million shares of Class A common stock at a price range of $24 to $26, at a nearly $6 billion valuation, according to the amended SEC filing. Circle plans to list its shares on the New York Stock Exchange under the ticker symbol CRCL. Circle's IPO comes close on the heels of fintechs eToro and Chime, both of which filed paperwork related to their public offerings earlier this month, suggesting market conditions appear favorable to go public. eToro, a social investment fintech founded in Israel, said it intended to raise $500 million through its public offering. eToro's stock opened at $69.69, which was 34% above its IPO, and closed at roughly $67 per share, bringing its total market capitalization to more than $5.4 billion. Chime, for its part, said the number of shares to be offered and the price range for the proposed offering had not yet been decided. 'In many respects, Circle has for a long time been under intense public scrutiny — the demands of operating an always-on, regulated digital dollar infrastructure require that Circle operates with high levels of transparency —as well as significant regulatory supervision by government agencies spanning the United States and the world,' Circle's co-founder and CEO, Jeremy Allaire said in the filing. The fintech that doesn't 'fit in a box' from a public market perspective is a mix of a payments company, a financial institution, and a consumer internet and platform software company, according to Allaire. 'Going public now is representative of the fact that we are at a significant crossroads for Circle and the development of the internet financial system,' Allaire wrote Monday. 'While we are proud and confident about our ability to pursue this opportunity, our future (like our past) is rife with uncertainties and risks that we must navigate successfully,' he wrote. The potential offering values the company at roughly $5.65 billion at the top end of the price range, but when accounting for stock options and restricted share units, the valuation would be about $6.7 billion, according to Bloomberg. Circle was co-founded by Allaire and Sean Neville in 2013. There was around $60 billion of Circle's USD Coin in circulation as of the end of March, according to an SEC filing. Days prior to filing IPO paperwork, Circle denied a report it was in talks to sell to Coinbase Global or Ripple. Circle has been pursuing an IPO since 2021. An original agreement announced in July 2021 was revised the following year, thereby delaying the company's IPO and renegotiating its original agreement with special-purpose acquisition company Concord Acquisition, doubling Circle's enterprise value from $4.5 billion to $9 billion. The revised valuation was due the circulation of USDC more than doubling after the deal was first announced. However, that $9 billion deal fell apart in December 2022. Circle said in Monday's filing that Cathie Wood's Ark Investment Management has expressed interest in buying up to $150 million of the shares that are offered. Circle also said it will give underwriters 30 days to purchase an additional 3.6 million Class A common stock to cover over-allotments. BlackRock reportedly plans to buy a 10% stake in Circle's IPO, some people familiar with the matter told Bloomberg. Circle estimates the net proceeds from the offering to be roughly $213.2 million or $298 million if the underwriters exercise their option. The fintech plans to utilize nearly $101 million of the net proceeds to satisfy tax withholding and remittance obligations related to vesting and net settlement of certain outstanding restricted stock units previously granted to its employees, and the remainder for general corporate purposes. Last week, the company launched Circle Payments Network, a new service that aims to connect eligible banks, neobanks, payment service providers and digital wallets to process payments instantly across borders using stablecoins like USDC. The company noted that banks and neobanks play an increasingly important role in the Circle stablecoin ecosystem, providing settlement and reserve infrastructure. 'We are seeing growth in startup banks and neo-banks in many emerging markets focused on providing digital dollar payment and settlement services using USDC and the Circle stablecoin network,' Circle said in the filing. The latest IPO filing occurs as the cryptocurrency and digital asset regulatory landscape in the U.S. evolves following the election of President Donald Trump. In January, the SEC launched a crypto task force dedicated to developing a comprehensive and transparent regulatory framework for digital assets. Following the task force announcement, Trump signed an executive order establishing a new working group on digital asset markets. Circle is hopeful that a comprehensive regulatory framework for payment stablecoins will be established, it said in the filing. While the final version of the Guiding and Establishing National Innovation for U.S. Stablecoins Act is not published yet, any version of the law 'should drastically increase the odds of successful crypto company IPOs,' since market participants are looking forward to certainty and stability that would be provided by implementation of a federally-authorized regulatory framework, Patrick Hanchey, a partner at law firm Alston & Bird noted. 'I don't foresee any circumstances where the establishment of a formal regulatory regime around stablecoin could slow or discourage market participation in this sector, especially under the current administration,' Hanchey said in an email response. The IPO is being led by JPMorgan Chase, Citi and Goldman Sachs. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Business
- Yahoo
BancFirst to buy Oklahoma lender hit with DOJ redlining order
This story was originally published on Banking Dive. To receive daily news and insights, subscribe to our free daily Banking Dive newsletter. Oklahoma City-based BancFirst has agreed to buy in-state peer American Bank of Oklahoma, a Collinsville-based privately held community lender. The acquisition will add roughly $385 million in total assets, $280 million in loans and $320 million in deposits to BancFirst's $14 billion in assets, the larger lender said last week. The transaction is expected to close in the third quarter, according to the press release. The financial terms of the deal were not disclosed. BancFirst aims to leverage ABOK's presence in the Tulsa metro area with its Collinsville and Skiatook branches, about 20 miles north of Tulsa. 'Collinsville and Skiatook are thriving communities that continue to experience dynamic growth in Northeastern Oklahoma,' BancFirst CEO David Harlow said in a statement. 'We are excited to welcome the American Bank of Oklahoma team and their customers to BancFirst. This acquisition aligns with our continued commitment to serving communities here in our home state.' BancFirst's last acquisition, The First National Bank and Trust Company of Vinita, was placed under a prompt corrective action directive by the Office of the Comptroller of the Currency in January 2021, just before the acquisition was announced. The OCC deemed the bank to be engaging in unsafe and unsound practices and notified the lender it would be subjected to supervisory actions applicable to undercapitalized lenders. A month later, BancFirst announced the purchase and assumption of assets and liabilities of the troubled bank. ABOK has had its share of challenges as well. In February, ABOK was fined $7,500 by the Federal Deposit Insurance Corp. for violating FDIC rules related to flood insurance. The lender allegedly failed to obtain sufficient flood insurance coverage for properties in special flood hazard areas and ensure proper coverage before loan origination, increase, extension, or renewal. ABOK agreed to pay the civil money penalty without denying or admitting to the findings. In August 2023, ABOK agreed to pay more than $1.15 million to settle a Justice Department investigation into allegations that the lender engaged in inadequate mortgage lending practices in majority-Black and Hispanic neighborhoods in the Tulsa metropolitan area from 2017 to at least 2021. Under the consent order, the lender was required to open a branch in a majority-Black and Hispanic census tract within its four-county lending area around Tulsa. Additionally, ABOK was required to put at least $950,000 in a loan fund to subsidize mortgages and home improvement financing in predominantly Black and Hispanic neighborhoods. ABOK, for its part, denied the DOJ's allegations that the bank failed to monitor and address fair lending risk appropriately. The community bank had a partial win when a magistrate judge removed two references to the 1921 Tulsa Race Massacre from the redlining consent order to which the bank had objected. ABOK noted that the DOJ's decision to reference the 'distressing historical event' in its complaint was concerning since the bank was established 77 years after the massacre. BancFirst did not respond to requests for comments by press time. ABOK will operate under its present name until the merger with BancFirst is completed, the company said. 'Joining forces with BancFirst represents a great opportunity for our customers and employees to join one of the strongest banks in the country,' Teresa Brown, CEO of American Bank of Oklahoma. 'We share common values and a commitment to local service, and we look forward to the partnership.' BancFirst also operates two subsidiary Texas state-chartered banks: Pegasus Bank, headquartered in Dallas, and Worthington Bank, headquartered in Arlington. BancFirst has 104 locations with over 2,000 employees serving 60 counties in Oklahoma. Recommended Reading Valley National Bank to buy Bank Leumi's US arm in $1.15B deal Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Business
- Yahoo
Wells Fargo's Scharf assured over asset cap's potential end
This story was originally published on Banking Dive. To receive daily news and insights, subscribe to our free daily Banking Dive newsletter. Wells Fargo CEO Charlie Scharf expressed confidence Wednesday that the bank is inching closer to the point it will be freed from the $1.95 trillion asset cap it's operated under for seven years. Just two consent orders remain for Wells, including the growth constraint imposed by the Federal Reserve in 2018. Scharf, speaking Wednesday at a Bernstein conference, seemed to suggest the cap will be lifted sooner than later. 'Our level of confidence in terms of where we are and how far we are down that road is extremely high,' Scharf said. 'We're not done, but we're a hell of a lot closer to the end than the beginning, at this point.' There's been plenty of speculation that 2025 will be the year Wells is freed from the growth restriction. Analyst Ken Usdin noted the bank is 'closer and closer to emerging from what's been a very inward-focused period of time for the company,' as it's overhauled risk management and internal controls to satisfy its various regulatory orders. The regulatory clampdown followed a scandal in which employees of the San Francisco-based lender opened millions of fake customer accounts to hit sales targets. Wells is spending about $2 billion annually on its risk and control agenda, and has simplified its business, exiting some areas with lower returns or lackluster growth rates. The bank has also brought in a number of fresh faces – 150 of the bank's top 220 people are new – establishing the 'proper risk mindset' at the company, Scharf said. Six consent orders have been cleared this year, and 12 since 2019, when Scharf became CEO. Lifting the asset cap and the ultimate consent order are two different decision points for the Fed, and Scharf said he couldn't speak for the central bank's timing. He noted, though, that most of the work completed for other now-closed consent orders is 'foundational' to those that remain. 'Those are just very good proof points for you all to say we're much closer to that order being lifted than…something other than that,' the CEO said. 'We feel very, very confident that it's going to get lifted.' With the removal of that limitation on the horizon, the bank is preparing to pounce on growth in its retail deposits business. Given the fake-accounts scandal, sales practices were 'front and center' among the bank's issues, Scharf said, so the bank had to 'literally scale back almost everything that we were doing to drive growth in the retail system, and then rebuild it from the bottom up.' During a multiyear period, the bank 'didn't have branch [profits and losses], we didn't have sales reporting, we weren't focused on expanding the product set, improving the digital capabilities, because we were so focused on creating the right infrastructure to satisfy the regulators – appropriately so – so that they and we could be comfortable, when we turn these things back on, that we could grow properly,' he said. The closure of the sales practices consent order 'was a hugely important point,' revealing regulators' comfort level, allowing Wells to re-create an environment where the bank can focus on doing more for customers, he said. Wells is particularly focused on primary checking account growth, Scharf said. 'We worked really hard to try and preserve share before; now the focus has gone to, what do we have to do to increase share?' he said. To do that, the bank has changed compensation plans and introduced reporting; simplified its product set and segmented it to serve more and less affluent customers; is spending 'significantly more' on marketing; and is focused on improving its branch experience while bolstering digital capabilities, he said. Each of the bank's segments – consumer and small-business banking, consumer lending, wealth management, commercial banking and corporate and investment banking – 'should be growing faster than they're growing today and have higher returns,' Scharf said. When the asset cap is eventually lifted, 'there's no light switch' related to the bank's growth trajectory, he said. But 'it does lift a cloud that exists around Wells,' as the cap has limited the bank, both tangibly and in mindset. The bank has been constrained in its ability to take commercial deposits, for example, and its corporate and investment bank growth has been limited. 'The scarlet letter goes away, and we're not differentiated from the other companies out there,' and bankers can think more aggressively, Scharf added. A caveat on his growth and earnings assertion: He stressed that the bank is exercising caution with home lending, 'where you can chase short-term returns and chase growth and it can turn out very, very badly for you in the future,' and is more focused on building it as a relationship product; and with auto lending, 'where we're focused on returns, not growth.' Scharf also noted the asset cap isn't a constraint on loan growth, because the demand isn't there and hasn't been for several years. 'When you look at all of the lending that's being done outside of the banking system, why do banks not see the demand, but there's this huge demand that exists outside?' he said, pointing to the growth of private credit, which has ballooned to a $1.6 trillion industry. 'That is an interesting question, which we also think the regulators need to look at, in terms of what is driving that?' Scharf said.
Yahoo
2 days ago
- Business
- Yahoo
Citi sells Polish consumer business to VeloBank
This story was originally published on Banking Dive. To receive daily news and insights, subscribe to our free daily Banking Dive newsletter. Citi Handlowy, Citi's Polish arm, will sell its consumer banking business to VeloBank and shift its focus to institutional clients. The deal, announced Wednesday and subject to regulatory approvals and antitrust clearance, is expected to close by mid-2026. The estimated value of the sale for shareholders will amount to about 1.1 billion zloty ($292.5 million), Citi Handlowy told Reuters. In a press release, Citi said the deal will be financially immaterial to the bank, but that it expects it to lead to a modest regulatory capital benefit upon closing. 'Citi Handlowy has been providing financial solutions to corporations in Poland through a history spanning 155 years, and we remain fully committed to Poland's economic growth and to our institutional clients in the country,' Ernesto Torres Cantú, Citi's head of international, said in a prepared statement. 'This transaction enables us to deploy additional resources to our institutionally focused businesses, so we can continue to connect corporations in Poland to our global network.' The buyer, VeloBank, is affiliated with Cerberus Capital Management, the European Bank for Reconstruction and Development and the International Finance Corporation. Citi Handlowy's consumer banking business includes wealth management, micro business banking, credit cards and consumer loans, as well as deposits and assets under management, consumer clients of the brokerage business, branches and other consumer-related assets. The bank plans to continue to invest in its institutional businesses. This is part of a broader retreat from retail banking in 14 international markets, which the bank began in 2021. Thus far, Citi has closed sales in nine markets and wound down three of them. Poland marks its 10th sale, according to a spokesperson. The bank had determined the markets weren't scalable, the spokesperson said. Citi's sole remaining international consumer business is in Mexico. In December, Citi separated its retail business there, Banamex, from its institutional operations, and plans to pursue an initial public offering for Banamex this year. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
