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Tag: banking institutions

  • Camp toy store pleads for help after Silicon Valley Bank collapse | CNN Business

    Camp toy store pleads for help after Silicon Valley Bank collapse | CNN Business


    New York
    CNN
     — 

    A toy company based in New York has gotten caught up in the collapse of Silicon Valley Bank and is pleading with customers for help keeping it afloat.

    Camp, a venture-backed retailer, sent an email to customers Friday announcing it was slashing prices and would use sales to help fund its continued operations after much of its money was tied up in the bank failure.

    “Unfortunately, we had most of our company’s cash assets at a bank which just collapsed. I’m sure you’ve heard the news,” co-founder Ben Kaufman said in an email to customers.

    He urged customers to use the code “BANKRUN” to save 40% off all merchandise, in an apparent nod to the run on the bank that may have helped bring down the Silicon Valley lender. Camp also said customers could pay full price, which it said would be appreciated.

    Kaufman said the company was “hopeful that this will be resolved soon.”

    CNN has not confirmed if Camp had funds with Silicon Valley Bank when the bank collapsed.

    Silicon Valley Bank was put under control of the US Federal Deposit Insurance Corporation on Friday, capping off a stunning 48 hour period during which fears of a liquidity crisis at the firm prompted some startups to weigh withdrawing funds.

    The sudden collapse of the Silicon Valley lender has pushed tech investors and startups to scramble to figure out their financial exposure to the bank, with founders worrying about getting their money out, making payroll and covering operating expenses.

    The rapidly unfolding fallout at Silicon Valley Bank comes at a challenging moment for startup and tech industries. Rising interest rates have eroded the easy access to capital that helped fuel soaring startup valuations and funded ambitious, money-losing projects.

    Kaufman, a former BuzzFeed executive, founded Camp in 2018. It has nine stores in California, Connecticut, Massachusetts, New York, New Jersey and Texas.

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  • Credit Suisse delays annual report after ‘late call’ from the SEC | CNN Business

    Credit Suisse delays annual report after ‘late call’ from the SEC | CNN Business


    London
    CNN
     — 

    Credit Suisse can’t catch a break.

    In the latest piece of troubling news, the beleaguered Swiss bank has delayed the publication of its 2022 annual report following a “late call” from the US Securities and Exchange Commission on Wednesday evening.

    The SEC got in touch over revisions the bank had previously made to its cash flow statements for 2019 and 2020, Credit Suisse

    (CS)     said in a statement Thursday.

    Shares in the bank, which have been trading around record lows, slid 5%.

    “Management believes it is prudent to briefly delay the publication of its accounts in order to understand more thoroughly the comments received,” the company said.

    Credit Suisse added that its 2022 financial results were not impacted. Those revealed the biggest annual loss since the financial crisis in 2008, laying bare the scale of the challenge the bank faces as it attempts a turnaround.

    Thursday’s news underscores that challenge and will also add to concerns about governance at Credit Suisse. It is already in the crosshairs of Switzerland’s financial regulator, which is reportedly looking into comments the lender’s chairman made about the health of its finances.

    Customers withdrew 111 billion Swiss francs ($121 billion) in the final three months of 2022, when the bank was hit by social media speculation that it was on the brink of collapse.

    The rumors, which sparked a selloff in the lender’s shares, followed a series of missteps and compliance failures that have hurt the bank’s reputation and profit, as well as costing top executives their jobs.

    Finma, the Swiss regulator, is seeking to establish the extent to which Axel Lehmann, and other bank representatives, were aware that clients were still withdrawing funds when he told reporters that outflows had stopped, Reuters reported last month, citing people familiar with the matter.

    Finma declined to comment and Credit Suisse told CNN it did not “comment on speculation.”

    In October, Credit Suisse embarked on a “radical” restructuring plan that entails cutting 9,000 full-time jobs, spinning off its investment bank and focusing on wealth management.

    “We have a clear plan to create a new Credit Suisse and intend to continue to deliver on our three-year strategic transformation by reshaping our portfolio, reallocating capital, right-sizing our cost base, and building on our leading franchises,” CEO Ulrich Körner said on February 9.

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  • Buying bank stocks before a recession used to be madness. Not anymore | CNN Business

    Buying bank stocks before a recession used to be madness. Not anymore | CNN Business


    London
    CNN
     — 

    Investors are bucking tradition this year by piling into big bank stocks just as major economies are expected to either slow down or fall into recession.

    The Stoxx Europe 600 Banks index, a group of 42 big European banks, climbed 21% between the start of the year and late February — when it hit a five-year high — outperforming its broader benchmark index, the Euro Stoxx 600

    (SXXL)    . The KBW Bank Index, which tracks 24 leading US banks, has risen by a more modest 4% so far this year, slightly outpacing the broader S&P 500

    (DVS)    .

    Both bank-specific indexes have surged since lows hit last fall.

    The economic picture is far less rosy. The United States and the biggest economies in the European Union are expected to grow at a much slower rate this year than last, while UK output is likely to contract. A sudden recession “at some stage” is also a risk for the United States, former Treasury Secretary Larry Summers told CNN Monday.

    But the widespread economic weakness has coincided with high inflation, forcing central banks to raise interest rates. That’s been a boon for banks, helping them make heftier returns on loans to households and businesses, and as savers deposit more of their money into savings accounts.

    Rate hikes have buoyed the stocks of big banks, but so too has a greater confidence in their ability to weather economic storms 15 years after the 2008 global financial crisis nearly toppled them, fund managers and analysts told CNN.

    “Banks are, generally speaking, much stronger, more resilient, more capable to [withstand a] recession,” than in the past, said Roberto Frazzitta, global head of banking at consultancy Bain & Company.

    Interest rates in major economies started climbing last year as policymakers launched their campaigns against soaring inflation.

    The steep rate hikes followed a prolonged period of ultra-low borrowing costs that started in 2008. As the financial crisis ravaged economies, central banks slashed interest rates to unprecedented lows to incentivize spending and investment. And, for more than a decade, they barely budged.

    Banks are a less attractive bet for investors in that environment as lower interest rates often feed into lower returns for lenders.

    “[The] post-crisis period of very low interest rates was seen as very bad for bank profitability, it squeezed their margins,” said Thomas Mathews, senior markets economist at Capital Economics.

    But the rate hiking cycle that got underway last year, and shows few signs of abating, has changed investors’ calculations. Fed Chair Jerome Powell said Tuesday that interest rates would rise more than people anticipated.

    Higher potential returns for shareholders are drawing investors back into the sector. For example, the average dividend yield for bank stocks in Europe — the amount of money a company pays its shareholders every year as a proportion of its share price — is now around 7%, said Ciaran Callaghan, head of European equity research at Amundi, a French asset management firm.

    By comparison, the dividend yield for the S&P 500 currently stands at 2.1%, and for the Euro Stoxx 600 at 3.3%, according to Refinitiv data.

    European bank stocks have risen particularly sharply in the past six months.

    Mathews at Capital Economics attributed their outperformance relative to US peers partly to the fact that interest rates in the countries that use the euro are still closer to zero than in the United States, meaning that investors have more to gain from rates rising.

    It can also be put down to Europe’s remarkable reversal of fortune, he said.

    Wholesale natural gas prices in the region, which hit a record high in August, have tumbled back to their levels seen before the Ukraine war, and a much-feared energy shortage has been avoided this winter.

    “Only a few months ago people were talking about a very deep recession in Europe compared to the US,” Mathews said. “As those worries have unwound, European banks have done particularly well.”

    But European economies are still fragile. When economic activity slows down, bank stocks are typically among those hit hardest. That’s because banks’ earnings are, to varying extents, tied to borrowers’ ability to repay their loans, as well as to consumers’ and businesses’ appetite for more credit.

    This time around, though — unlike in 2008 — banks are in a much better position to withstand defaults on loans.

    After the global financial crisis, regulators sprang into action, requiring lenders, among other measures, to have a large capital cushion against future losses. Capital is made up of a bank’s own funds, rather than borrowed money such as customer deposits.

    Lenders must also hold enough cash, or assets that can be quickly converted into cash, to repay depositors and other creditors.

    Luc Plouvier, a senior portfolio manager at Van Lanschot Kempen, a Dutch wealth management firm, noted that banks had undergone “structural change” in the past decade.

    “A lot of the regulation that’s been put in place [has] forced these banks to be more liquid, to have much more [of a] capital buffer, to take less risk,” he said.

    Joost de Graaf, co-head of European credit at Van Lanschot Kempen, agreed.

    “There are not any hidden skeletons in [banks’] balance sheets as far as we know.”

    — Julia Horowitz contributed reporting.

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  • CFPB: What it does and why its future is in question | CNN Business

    CFPB: What it does and why its future is in question | CNN Business


    New York
    CNN
     — 

    The US Supreme Court decided this week to hear a case that will consider the constitutionality of funding for the Consumer Financial Protection Bureau and, in doing so, test the constraints of US regulators’ power. The case would be heard in the fall, with a decision likely by summer 2024.

    But what is the CFPB? How does its work affect your wallet? And why is its future potentially at risk?

    The agency was created after the 2008 financial meltdown, as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act. That law was passed in the wake of the 2007 subprime mortgage crisis and the Great Recession that followed.

    The broad purpose of the CFPB is to protect consumers from financial abuses and to serve as the central agency for consumer financial protection authorities.

    Prior to its creation, as the agency notes on its site, “[c]onsumer financial protection had not been the primary focus of any federal agency, and no agency had effective tools to set the rules for and oversee the whole market.”

    The CFPB has regulatory authority over providers of many types of financial products and services, including credit cards, banking accounts, loan servicing, credit reporting and consumer debt collection.

    It is charged with implementing and enforcing consumer protection laws, making rules and issuing guidance for consumer financial institutions. And it is the place consumers can go to lodge complaints about financial products and services.

    Importantly, Dodd-Frank also gave the agency new authority to determine whether any given consumer financial product or service is unfair, deceptive or abusive and therefore unlawful.

    While there are critics of the agency’s current structure and funding, it has saved consumers money, made it easier for them to seek redress and to get better clarity and more tailored responses from companies when they have a problem with their accounts, loans or credit reports.

    “It has completely changed the consumer financial marketplace. Overall it has had a tremendous impact on making it more fair and transparent,” said Lauren Saunders, associate director of the National Consumer Law Center.

    For instance, the CFPB has taken action against bank overdraft policies. “Arguably, the focus on overdraft practices has led some banks to eliminate or reduce their overdraft fees,” said Christine Hines, legislative director of the National Association of Consumer Advocates.

    And it has gone after institutions for saddling consumers with pointless products, excessive fees and punitive terms.

    Both Hines and Saunders made a special note of CFPB’s actions against Wells Fargo, after the agency found the bank had been engaging in multiple abusive and unlawful consumer practices across several financial products between 2011 and 2022 — from auto loans to mortgage loans to bank accounts.

    Last month, the agency required the bank to pay more than $2 billion to customers who were harmed by such practices, plus a $1.7 billion fine that will go into a relief fund for victims.

    “More than 16 million accounts at Wells Fargo were subject to their illegal practices, including misapplied payments, wrongful foreclosures, and incorrect fees and interest charges,” the agency said in a blog post.

    In the area of mortgages, “CFPB has written rules to implement new protections so that mortgage lenders don’t make loans with tricks and traps that lead people to lose their homes,” Saunders said.

    It also has created other safeguards, including rules on how service providers should communicate with borrowers who want to find alternatives to foreclosure, Hines noted.

    Currently, the agency is in the midst of an effort to curb excessive or “junk” fees on a range of consumer financial products, such as credit card late fees.

    Critics of the CFPB have been trying for years to limit its power and independence, attacking the way the agency is structured and funded. Like federal banking regulators, its funding is not determined by lawmakers in Congress as part of the annual appropriations process. Rather, it gets its money from the Federal Reserve System’s earnings.

    “This nontraditional funding source limits congressional oversight of the agency and is the subject of legal challenges,” according to the Congressional Research Service.

    The latest challenge — arising from a federal appeals court ruling that CFPB’s funding violates the Constitution’s Appropriations Clause and separation of powers — is what the Supreme Court will take up in its October term.

    While it’s impossible to predict how the justices will rule, should they decide to uphold the appeals court ruling, that will put in doubt how the agency will be funded going forward, and whether it can continue to function effectively.

    It’s also unclear whether the agency’s actions and rule-making over the past 11 years would be invalidated, nor what impact it would have on banks and other financial institutions that have set up systems to be in compliance with CFPB rules and safe harbors.

    “The agency would be unable to do anything if the funding is invalidated. And prior rules could be challenged as the agency did not have a legal funding source that it could use to write those rules,” Cowen Washington Research Group analyst Jaret Seiberg said in a note to clients.

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  • Biden nominates former MasterCard exec Ajay Banga to lead World Bank | CNN Business

    Biden nominates former MasterCard exec Ajay Banga to lead World Bank | CNN Business


    New York
    CNN
     — 

    President Joe Biden has announced that he’s nominating Ajay Banga, a former MasterCard executive, to serve as president of the World Bank.

    In a statement, Biden said that Banga is “uniquely equipped to lead the World Bank at this critical moment in history” and that he has a “proven track record managing people and systems, and partnering with global leaders around the world to deliver results.”

    Banga has been the vice chairman at General Atlantic, a New York-based investment firm, since 2022. Prior to that, the 63-year-old was the CEO of MasterCard from 2010 to 2021.

    “Raised in India, Ajay has a unique perspective on the opportunities and challenges facing developing countries and how the World Bank can deliver on its ambitious agenda to reduce poverty and expand prosperity,’ Biden said in the statement. Notably, the White House highlighted Banga’s “extensive experience” in creating partnerships to address climate change and financial inclusion,” something Biden pledged would be an important qualification for the next World Bank President.

    Banga would replace previous president David Malpass, who announced last week that he’s stepping down a year early — serving four years of a five-year term.

    Although Malpass had been praised by the World Bank and administration officials for his handling of the global challenges posed by Russia’s invasion of Ukraine and the Covid-19 pandemic, his tenure faced controversy following comments he made last September about climate change. During a panel, herefused to confirm during a climate panel whether he accepted the scientific consensus that burning fossil fuels were dangerously warming the planet.

    After an outpouring of criticism, many opponents called for his resignation. However, he recently told CNN’s Julia Chatterley that he has “no regrets” over his four-year tenure.

    “We’ve achieved many of the things I wanted to…I think it’s really important that institutions have energy, new energy, and this is a good time for the World Bank to do that,” he said.

    US Treasury Secretary Janet Yellen praised the decision to name Banga in a statement.

    “He has the right leadership and management skills, experience living and working in emerging markets, and financial expertise to lead the World Bank at a critical moment in its history, deliver on its core development goals, and evolve the Bank to meet global challenges like climate change,” she said.

    US climate envoy John Kerry said Banga is the “right choice” because of his climate change credentials.

    Banga “has proven his ability as a manager of large institutions and understands investment and the mobilization of capital to power the green transition,” Kerry said in a statement.

    The World Bank, a group of 187 nations, lends money to developing countries to help reduce poverty. Former US President Donald Trump appointed Malpass as World Bank chief in 2019 for a five-year period. As the largest shareholder, the United States traditionally appoints its president.

    — CNN’s Sam Fossum contributed to this report.

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  • JPMorgan restricts employee use of ChatGPT | CNN Business

    JPMorgan restricts employee use of ChatGPT | CNN Business


    London
    CNN
     — 

    JPMorgan Chase is temporarily clamping down on the use of ChatGPT among its employees, as the buzzy AI chatbot explodes in popularity.

    The biggest US bank has restricted its use among global staff, according to a person familiar with the matter. The decision was taken not because of a particular issue, but to accord with limits on third-party software due to compliance concerns, the person said. JPMorgan Chase

    (JPM)     declined to comment.

    ChatGPT was released to the public in late November by artificial intelligence research company Open AI. Since then, the much-hyped tool has been used to turn written prompts into convincing academic essays and creative scripts as well as trip itineraries and computer code.

    Adoption has skyrocketed. UBS estimated that ChatGPT reached 100 million monthly active users in January, two months after its launch. That would make it the fastest-growing online application in history, according to the Swiss bank’s analysts.

    The viral success of ChatGPT has kickstarted a frantic competition among tech companies to rush AI products to market. Google recently unveiled its ChatGPT competitor, which it’s calling Bard, while Microsoft

    (MSFT)    , an investor in Open AI, debuted its Bing AI chatbot to a limited pool of testers.

    But the releases have boosted concerns about the technology. Demos of both Google and Microsoft’s tools have been called out for producing factual errors. Microsoft, meanwhile, is trying to rein in its Bing chatbot after users reported troubling responses, including confrontational remarks and dark fantasies.

    Some businesses have encouraged workers to incorporate ChatGPT into their daily work. But others worry about the risks. The banking sector, which deals with sensitive client information and is closely watched by government regulators, has extra incentive to tread carefully.

    Schools are also restricting ChatGPT due to concerns it could be used to cheat on assignments. New York City public schools banned it in January.

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  • Standard Chartered plans hiring spree in Hong Kong as city reopens to China | CNN Business

    Standard Chartered plans hiring spree in Hong Kong as city reopens to China | CNN Business


    Hong Kong
    CNN
     — 

    Standard Chartered is going on a hiring spree in Hong Kong this year, in a sign of renewed confidence in its biggest market as the city reopens its border with mainland China.

    The British bank said it would add 300 to 500 employees to its ranks of roughly 5,500 to 5,800. That would lift its current headcount in the city by up to 9%.

    The move comes as the lender’s business in the global finance hub begins to recover to pre-pandemic levels.

    In a results presentation Friday, Chief Financial Officer Andy Halford said that despite Hong Kong’s economic challenges, the bank grew its operating income in the city by 9% to just over $3.7 billion, which was “back to around 2019 levels.”

    The firm is encouraged by early signs of “a pickup” in Hong Kong, he told analysts.

    Standard Chartered

    (SCBFF)     Hong Kong CEO Mary Huen said the new recruitment drive would position the bank to capitalize on the reopening of the city’s border with mainland China.

    China fully reopened its borders with its special administrative regions of Hong Kong and Macao this month, in what is expected to be a major boost for the economies of the two cities.

    The reopening “is set to increase business opportunities” in fintech, wealth management and China’s Greater Bay Area, an economic zone that connects Guangdong province with Hong Kong and Macao, Huen said Friday.

    “We need to hire more people as we expect there will be a good growth in loan and wealth management demand this year,” she added.

    HSBC

    (HSBC)    , Hong Kong’s leading bank, also flagged a strong performance in the city.

    In a Tuesday earnings statement, CEO Noel Quinn said the London-based lender had “gained market share last year in key products, including customer deposits, insurance and trade finance.”

    Chairman Mark Tucker said the firm was anticipating a boost in business from China’s resurgence.

    “The reopening of the border means that Hong Kong, and the entire Greater Bay Area, are likely to be major beneficiaries, and I expect to see a strong recovery,” he said in the statement.

    HSBC reported a 92% jump in adjusted pretax profit to $6.8 billion in the fourth quarter of 2022, which was higher than analysts’ expectations. Hong Kong is also its biggest market.

    The city hopes to stage a comeback as it continues to recover from two and a half years of pandemic restrictions.

    In November, the city’s leader, John Lee, welcomed some of Wall Street’s top executives to its biggest international event in years, urging them to invest locally and seeking to reassure them that it would maintain a distinct role to that of mainland China.

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  • China’s property crash is prompting banks to offer mortgages to 70-year-olds | CNN Business

    China’s property crash is prompting banks to offer mortgages to 70-year-olds | CNN Business


    Hong Kong
    CNN
     — 

    The property market in China is so depressed that some banks are resorting to drastic measures, including allowing people to pay off mortgages until they are 95 years old.

    Some banks in the cities of Nanning, Hangzhou, Ningbo and Beijing have extended the upper age limit on mortgages to between 80 and 95, according to a number of state media reports. That means people aged 70 can now take out loans with maturities of between 10 and 25 years.

    China’s property market is in the midst of a historic downturn. New home prices had fallen for 16 straight months through December. Sales by the country’s top 100 developers last year were only 60% of 2021 levels.

    Analysts say the new age limits, which aren’t yet official national policy, aim to breathe life into the country’s moribund property market while taking into consideration China’s rapidly aging population, said Yan Yuejin, a property analyst at E-House China Holdings, a real estate services firm, in a recent research note.

    “Basically, it’s a policy tool to stimulate housing demand, as it can alleviate the debt payment burden and encourage home buying,” he added.

    The new mortgage terms are like a “relay loan.” If the elderly borrower isn’t able to repay, his or her children must carry on with the mortgage, he said.

    Last month, China reported that its population shrank in 2022 for the first time in more than 60 years, a new milestone in the country’s deepening demographic crisis with significant implications for its slowing economy. The number of people aged 60 or above increased to 280 million by the end of last year, or 19.8% of the population.

    The mortgage borrower’s age plus mortgage length should not usually exceed 70 years, according to previous rules published by the banking regulator. China’s average life expectancy is around 78.

    The China Banking and Insurance Regulatory Commission hasn’t commented publicly about the new terms.

    But bank branches across the country are setting their own terms on these multi-generational loans.

    According to the Beijing News, a branch of Bank of Communications in the city said borrowers as old as 70 can take out home loans lasting 25 years, which means the upper age limit on its mortgages has been lifted to 95.

    But there are also prerequisites: The mortgage needs to be guaranteed by the borrower’s children, and their combined monthly income must be at least twice the monthly mortgage payment.

    Separately, a branch of Citic Bank has extended the upper age limit on its mortgages to 80, the paper said, citing a bank client manager.

    Calls to the Beijing branches of Citic Bank and Bank of Communications were not answered.

    Hong Hao, chief economist at Grow Investment Group, said this was a “drastic” measure and “could be a marketing gimmick to attract the elderly to pay [mortgages] for the younger generation.”

    Yan from E-House said the main beneficiary of the move might not be the elderly, but middle-aged borrowers between 40 and 59. Under the extended payment cutoff age, those people could get a mortgage for 30 years — the maximum length allowed in China.

    Compared with previous terms, it means those borrowers could pay less each month.

    “It is obviously a way to alleviate the debt payment burden,” said Hong.

    According to calculations by E-House, if a bank extends the upper age limit to 80, borrowers aged from 40 to 59 can get 10 additional years on their mortgages. Assuming their mortgage is one million yuan ($145,416), then their monthly payment can be reduced by 1,281 yuan ($186), or 21%.

    Chinese households have grown reluctant to purchase new homes in the past year, as the now-defunct Covid curbs, falling home prices and rising unemployment have discouraged would-be buyers. Last summer, protests that erupted in dozens of cities were staged by people refusing to pay mortgages on unfinished homes, dealing a further blow to market sentiment.

    Authorities have rolled out a flurry of stimulus measures to try to revive the housing market, including several cuts to lending rates and measures to ease the liquidity crisis for developers — so that they can resume stalled construction and deliver pre-sold homes to buyers as quickly as possible.

    Other than Beijing, some banks in Nanning, the provincial capital of Guangxi province, have raised the upper age limit on mortgages to 80, according to the city’s official newspaper Nanguo Zaobao.

    In the eastern cities of Ningbo and Hangzhou, several local lenders are advertising age limits of 75 or 80, a relaxation from previous rules, according to reports by government-owned Ningbo Daily and Hangzhou Daily.

    “If the applicant is too old to meet the loan requirement, they can have their children as the guarantor,” a lender was quoted as saying.

    But Wang Yuchen, a real estate lawyer at Beijing Jinsu Law Firm, warned such mortgages were “risky.”

    It’s understandable that many cities are trying to revive their housing markets by reducing the monthly debt payment and enlisting more elderly people into the pool of home buyers, he said in a written commentary on his WeChat account.

    “But the elderly have relatively poor repayment ability. On the one hand, it could affect their quality of life in old age, as they continue carrying the mortgage debt mountain and work for the bank until the last moment of their lives,” he said. “On the other hand, the associated risks may be transferred to their children, increasing their financial pressure.”

    “For some home buyers, choosing this way to purchase a house is probably because of their lack of funds. But it’s risky to do so at this time,” he said, adding that the property market is in a structural downturn and the government is still working to curb speculation.

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  • Alex Murdaugh hid settlement of more than $4 million from family of his late housekeeper, her son testifies | CNN

    Alex Murdaugh hid settlement of more than $4 million from family of his late housekeeper, her son testifies | CNN



    CNN
     — 

    Disgraced South Carolina attorney Alex Murdaugh never told the family of his late housekeeper that he collected more than $4 million in insurance settlements after she fell at his home, according to testimony at his double murder trial Friday.

    Outside the presence of the jury, Judge Clifton Newman heard testimony about Murdaugh’s alleged financial schemes as the court weighs whether to allow the admission of such evidence.

    Prosecutors want the evidence of financial wrongdoing admitted to show that the scion of one of the state’s most powerful families was, in their words, a desperate thief on the verge of being exposed at the time of the 2021 murders of his wife and adult son.

    Defense attorneys have portrayed the defendant as a loving father and husband being prosecuted after a poorly handled investigation while the real killers remain at large.

    Michael Satterfield, a son of Gloria Satterfield, who worked as housekeeper for the Murdaugh family for more than 20 years, testified in the second week of the murder trial. She died a few weeks after a fall at the Murdaugh home in 2018.

    Satterfield’s son told the court that Murdaugh offered to “go after my insurance company” to help their family with medical bills and other expenses.

    Michael Satterfield testified that Murdaugh at one point said Satterfield and his brother could each get $100,000 from the insurance company. They never got the money, he testified. And Murdaugh never mentioned a $5 million umbrella policy that he had in addition to a policy for a smaller amount.

    In June 2021, Michael Satterfield testified, his family heard their case was settled but Murdaugh did not disclose that he had collected on two settlements – one for more than $500,000 and another for $3.8 million.

    “Did he get your permission to steal your money?” Waters asked.

    “No.”

    “Did you ever get one cent from Alex Murdaugh?” Waters asked later.

    “No.”

    In December 2021, an attorney for the Satterfield family said Murdaugh agreed to a $4.3 million settlement with the family. He also issued an apology to the Satterfields.

    The first witness called Friday, also outside the jury’s presence, was Jan Malinowski, president and CEO of Palmetto State Bank. Palmetto’s former president, Russell Laffitte, was convicted of six counts of financial fraud crimes in November.

    Malinowski, who testified at Laffitte’s trial, told the court that Murdaugh’s mounting debt to the bank was regularly covered, without justification, by loans from Laffite.

    In August 2021, two months after the murders, Murdaugh’s account had an overdraft of more than $350,000, Malinowski testified. Laffitte responded with a $400,000 transfer to the defendant’s account.

    Murdaugh at the time owed the bank more than $4 million, Malinowski testified.

    Would the loans have kept coming had the bank known “that Murdaugh had been stealing money from his partners or … his clients?” asked Creighton Waters, a prosecutor with the South Carolina Attorney General’s Office – which is prosecuting the case because of the Murdaugh family’s long ties with the local solicitor’s office.

    “No sir,” the CEO replied.

    Waters, eliciting laughter in the courtroom, said the bank had “perhaps the most generous overdraft policy ever seen.”

    “Quite possibly,” Malinowski replied with a slight smile.

    Prosecutors, in pretrial filings, accuse Murdaugh of killing his wife, Margaret “Maggie” Murdaugh, and his 22-year-old son Paul Murdaugh to distract attention from alleged financial crimes, which the state contends were about to come to light when they were killed on June 7, 2021.

    In addition to the murder counts, he faces 99 charges related to those purported schemes.

    A pretrial motion from the state contended “the murders served as Murdaugh’s means to shift the focus away from himself and buy some additional time to try and prevent his financial crimes from being uncovered, which, if revealed, would have resulted in personal legal and financial ruin for Murdaugh.”

    The defense has fought the admissibility of the evidence in the murder case, asserting the fraud cases are irrelevant to the question of Murdaugh’s guilt in the murders of his wife and son.

    Murdaugh, who was disbarred amid a mountain of allegations of white-collar theft and fraud, faces 99 charges stemming from 19 grand jury indictments, including allegedly defrauding his clients and former law firm of nearly $9 million, according to the attorney general’s office.

    Under each case, Murdaugh faces the possibility of two sentences of life in prison without the possibility of parole if convicted.

    On Thursday, the chief financial officer of Murdaugh’s former law firm testified about confronting the now-disbarred attorney about missing funds the morning his wife and son were killed.

    Jeanne Seckinger, CFO of the firm formerly known as PMPED, testified outside the jury’s presence.

    The morning of the murders, Seckinger confronted Murdaugh about $792,000 in missing funds, she said Thursday, testifying that legal fees should have been made payable to the law firm – renamed to Parker Law Group after Murdaugh’s ouster – and not to individual attorneys.

    But Seckinger and other members of the firm realized in May 2021 they had not received a fee check stemming from a settlement signed in a case Murdaugh shared with another attorney, Seckinger testified, which was a concern.

    At the time, Murdaugh was facing a lawsuit from the family of 19-year-old Mallory Beach, who was killed in February 2019 when a boat, owned by Murdaugh and allegedly driven by Paul, struck a bridge piling.

    Murdaugh’s financial records – which state court filings said “would expose (Murdaugh) for his years of alleged misdeeds” – could have been disclosed following a hearing in the civil case scheduled for June 10, 2021, three days after the killings.

    But the June 10 hearing was canceled after Maggie and Paul’s deaths, Seckinger said Thursday, and the firm opted not to confront Murdaugh about the missing money.

    Eventually, the firm did confront Murdaugh about the missing money and “it was my understanding that Alex admitted it,” Seckinger testified.

    Before the firm could announce Murdaugh’s resignation, however, Seckinger testified she heard Murdaugh had been shot while on the side of the road. Murdaugh later told authorities he conspired with a former client to kill him as part of an insurance fraud scheme, purportedly so his surviving son could collect a $10 million life insurance payout.

    Finally, the court on Friday heard from a ballistics expert who told the court the .300 Blackout rifle cartridge casings found near Maggie’s body had identical markings to older casings found near the Murdaugh home as well as at a shooting range on their property.

    The older casings found near the house and in the shooting range “had those same matching mechanism marks to conclude they’d been loaded into, extracted and ejected from the same firearm as those at the crime scene around Margaret Murdaugh’s body,” Paul Greer, a firearm examiner with the South Carolina Law Enforcement Division, testified.

    The prosecution has said Maggie was killed with a .300 Blackout AR-15 rifle that was a “family weapon” but the weapon has yet to be found.

    During cross-examination by the defense on Friday, Greer said it is “hard to say” whether different .300 Blackout rifles could create the same markings on casings – but reaffirmed he was confident in his findings.

    Greer test fired one .300 Blackout rifle found in the gun room on the Murdaugh property and said the results were inconclusive on whether its ejected casings were an exact match with the casings found around Maggie’s body – but he said if the casings were not from that exact weapon, they came from one identical to it.

    Prosecutors have also said the Murdaughs owned other AR-style rifles, including one Murdaugh bought his son to replace another that went missing. The prosecution has said the replacement is “nowhere to be found.”

    Greer had similar testimony when the defense asked if Paul was killed with the camouflage-patterned gun Alex Murdaugh had on him when first responders arrived at the crime scene. The expert said he test fired that gun and the results were inconclusive. Greer testified he could not tell whether the casings were a match, but that it was possible the gun – or a weapon with similar characteristics – killed Paul.

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  • Bank of England takes interest rates to highest level since 2008 | CNN Business

    Bank of England takes interest rates to highest level since 2008 | CNN Business


    London
    CNN
     — 

    The Bank of England raised UK interest rates by half a percentage point on Thursday, moving more aggressively than its US counterpart to fight inflation.

    The central bank took rates to 4% — the highest level since the depths of the global financial crisis. UK inflation eased to 10.5% in December but remains near a 41-year high.

    The Bank of England said inflation was likely to fall sharply over the rest of the year, largely as past increases in energy and other prices fall out of the calculation. But it signaled significant uncertainty over its forecast.

    “The labor market remains tight and domestic price and wage pressures have been stronger than expected, suggesting risks of greater persistence in underlying inflation,” the bank said in a statement.

    Wholesale energy prices might also boost UK inflation more than expected, it added.

    The Bank of England had to weigh up current price growth against the risk of recession. On Tuesday, the International Monetary Fund forecast that the United Kingdom would be the only major economy to contract this year.

    The UK rate hike followed a quarter-point interest rate rise by the Federal Reserve on Wednesday. In contrast to the Bank of England, the Fed has slowed the pace of its increases as US inflation is starting to abate.

    The European Central Bank is also expected to hike rates for the 20 countries that use the euro by half a percentage point later on Thursday. Eurozone inflation fell in January but at 8.5% remains way above the ECB’s 2% target.

    — This is a developing story and will be updated.

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  • The Federal Reserve is testing how climate change could hurt big banks | CNN Business

    The Federal Reserve is testing how climate change could hurt big banks | CNN Business

    A version of this story first appeared in CNN Business’ Before the Bell newsletter. Not a subscriber? You can sign up right here. You can listen to an audio version of the newsletter by clicking the same link.


    New York
    CNN
     — 

    The largest six banks in the United States have been given until July to show the Federal Reserve what effects disastrous climate change scenarios could have on their bottom lines.

    Noting the risks could be “material,” the Fed said the banks will have to show how their finances fare under a number of climate stress tests, including heat waves, wildfires, floods and droughts, according to details of a new Fed pilot program released on Tuesday.

    “The pilot exercise includes physical risk scenarios with different levels of severity affecting residential and commercial real estate portfolios in the Northeastern United States and directs each bank to consider the impact of additional physical risk shocks for their real estate portfolios in another region of the country,” wrote the Fed.

    The Federal Reserve first announced the pilot program in September, noting that Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley and Wells Fargo would participate.

    Climate activists said that the project was long overdue (Federal Reserve Chair Jerome Powell has been questioned about it multiple times over the last year), and that other central banks are far ahead of the Fed on climate risk assessments. The Bank of England ran a similar exercise in 2021.

    They also said the proposal lacked any real teeth. In its announcement the Federal Reserve stressed that the exercise “is exploratory in nature and does not have capital consequences.” It also said that it would not publish individual banks’ results.

    San Francisco Federal Reserve President Mary Daly told CNN in October Thursday that this was a learning and exploratory exercise for the Federal Reserve. It would be “incredibly premature to jump to the conclusion that any new policies or programs would come out of it,” she said.

    The other side: Critics of the pilot program have argued that the Federal Reserve was overstepping its boundaries and that they might soon begin to enforce financial penalties.

    “The Fed’s new ‘pilot’ program is the first step toward pressuring banks into limiting loans to and investments in traditional energy companies and other disfavored carbon-emitting sectors,” wrote former Republican Senator Pat Toomey, then a ranking member of the Senate Banking Committee. “The real purpose of this program is to ultimately produce new regulatory requirements.”

    Powell said last week that the central bank would not become a “climate policymaker.”

    “Today, some analysts ask whether incorporating into bank supervision the perceived risks associated with climate change is appropriate, wise, and consistent with our existing mandates,” Powell said last Tuesday. “In my view, the Fed does have narrow, but important, responsibilities regarding climate-related financial risks. These responsibilities are tightly linked to our responsibilities for bank supervision. The public reasonably expects supervisors to require that banks understand, and appropriately manage, their material risks, including the financial risks of climate change.”

    The discovery, movement and use of oil has played an outsized role in shaping geopolitics over the past century and a half. But over the next 50 years, global interaction and wealth are more likely to be influenced by microchips, Intel CEO Pat Gelsinger told CNN Tuesday.

    “Where the technology supply chains are, and where semiconductors are built, is more important for the next five decades,” Gelsinger said in an interview with CNN’s Julia Chatterley at the World Economic Forum in Davos, Switzerland.

    Intel (INTC) is betting those predictions prove true. The company announced in 2021 it would invest $20 billion to build two new US chipmaking facilities, as well as up to $90 billion in new European factories, aimed at reasserting its position as the leader of the semiconductor industry, reports my colleague Clare Duffy.

    Gelsinger said the company’s investment in new manufacturing facilities in the United States, Europe and elsewhere is important not only for the company’s future, but for the “globalization of the most critical resource to the future of the world.”

    “We need this geographically balanced, resilient supply chain,” he said.

    The announcements also came amid concerns about the concentration of manufacturing for chips, in Asia, particularly China and Taiwan, during the Covid-19 pandemic and as geopolitical tensions grew. Issues in the chip supply chain in recent years have caused shortages and shipping delays of everything from desktop computers and iPhones to cars.

    “If we’ve learned one thing from the Covid crisis and this multi-year journey that we’ve been on it’s we need resilience in our supply chains,” Gelsinger said, adding that Intel’s manufacturing investments are aimed at “leveling that playing field so that good investment decisions can be made.”

    The years following the peak of the Covid pandemic have not been good for wealth equality.

    The world’s wealthiest residents have been getting far richer, far faster than everyone else over the past two years, reports my colleague Tami Luhby.

    The fortune of the 1% soared by $26 trillion during that period, while the bottom 99% only saw their net worth rise by $16 trillion, according to Oxfam’s annual inequality report released Sunday.

    And the wealth accumulation of the super-rich accelerated during the pandemic. Looking over the past decade, they netted just half of all the new wealth created, compared to two-thirds during the last few years.

    Meanwhile, many of the less fortunate are struggling. Some 1.7 billion workers live in countries where inflation is outpacing wages. And poverty reduction likely stalled last year after the number of global poor skyrocketed in 2020.

    “While ordinary people are making daily sacrifices on essentials like food, the super-rich have outdone even their wildest dreams,” said Gabriela Bucher, executive director of Oxfam International.

    “Just two years in, this decade is shaping up to be the best yet for billionaires — a roaring ’20s boom for the world’s richest,” she said.

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  • Yen falls after Bank of Japan maintains ultra-easy policy | CNN Business

    Yen falls after Bank of Japan maintains ultra-easy policy | CNN Business


    Hong Kong
    CNN
     — 

    The yen plunged on Wednesday after the Bank of Japan decided to maintain its ultra-easy monetary policy, defying market expectations that rising inflation could force the central bank to move away from low interest rates.

    The BOJ kept its yield curve control (YCC) targets unchanged as it concluded a two-day policy meeting on Wednesday. It left the short-term interest rate at an ultra-dovish minus 0.1% and the 10-year Japanese Government Bonds (JGB) yield around 0%.

    The YCC policy is a pillar of the central bank’s effort to keep interest rates low and stimulate the economy.

    “Japan’s economy, despite being affected by factors such as high commodity prices, has picked up as the resumption of economic activity has progressed while public health has been protected from Covid-19,” the central bank said in its quarterly outlook report, adding that slowdowns in overseas economies could put downward pressure on growth.

    The Japanese yen tumbled against the US dollar shortly after the announcement. It last traded at 131.34 yen per dollar, down 2.5%. Last Friday, it hit a seven-month high of 127.46 against the greenback.

    Last month, the BOJ shocked global markets by allowing the 10-year JGB yield to move 50 basis points on either side of its 0% target, in a move that stoked speculation the central bank may follow the same direction as other major economies by allowing rates to rise further.

    The unexpectedly hawkish decision caused stocks to tumble, while sending the yen and bond yields soaring.

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  • Forget inflation, it’s all about earnings | CNN Business

    Forget inflation, it’s all about earnings | CNN Business


    New York
    CNN
     — 

    To everything there is a season and now is the time for earnings.

    Over the past few weeks investors have been squarely focused on inflation and Fed policy, but now market reactions are getting bigger for earnings (especially the misses) and smaller for economic data.

    What’s happening: “We expect earnings to take the center stage going forward,” wrote Bank of America strategists Savita Subramanian and Ohsung Kwon in a note on Friday. They noted that over the last three quarters, S&P 500 reactions to earnings beats and misses have soared higher and have now surpassed the one-day market reaction to both CPI inflation and Fed policy meeting decisions.

    Companies that missed on both sales and earnings-per-share during the last quarter underperformed the S&P 500 by nearly six percentage points on average the next day, the largest reaction to earnings misses on record.

    Shares of Disney sank 13.16% last November — their lowest level in more than two years — when they missed earnings estimates. Meta shares plummeted 24% after showing a drop in third-quarter revenue in October, the company’s second consecutive quarterly revenue decline. And shares of Palantir closed down more than 11% in November after it missed estimates only slightly.

    “We see this as a narrative shift in the market from the Fed and inflation to earnings: reactions to earnings have been increasing, while reactions to inflation data and FOMC meetings have been getting smaller,” wrote Subramanian and Kwon.

    So we can expect some serious volatility over the next few weeks as companies report their fourth quarter corporate earnings.

    Bank of America’s predictive analytics team analyzed earnings transcripts to calculate sentiment scores and found that corporate sentiment remained flat in the third quarter, well off its highs, which points to a potential earnings decline ahead.

    Similarly, companies’ references to of better business conditions (specific usage of the words “better” or “stronger” vs. “worse” or “weaker”) remained well below the historical average, and mentions of optimism dropped to the lowest level since the first quarter of 2020.

    So far, swings have been to the downside. S&P 500 fourth-quarter earnings-per-share estimates have dropped by about 7% since October. Early earnings reports from some of the largest financial institutions point to a bleak quarter.

    Bad news ahead: The estimated earnings decline for the S&P 500 in the fourth quarter of 2022 is -3.9%, according to a FactSet analysis. If that is indeed the actual drop, it will mark the first earnings decline reported by the index since the third quarter of 2020.

    Over the past few weeks, reported FactSet, earnings expectations for the first and second quarters of 2023 switched from year-over-year growth to year-over-year declines.

    The latest: JPMorgan beat estimates for fourth-quarter revenue but also increased the amount of money for expected defaults on loans. The bank added a $2.3 billion provision for credit losses in the quarter, a 49% increase from the third quarter.

    The move was driven by a “modest deterioration in the Firm’s macroeconomic outlook, now reflecting a mild recession in the central case,” said the report. On a subsequent call, JPMorgan CFO Jeremy Barnum told reporters that the bank expects a recession to hit by the fourth-quarter of 2023.

    Bank of America

    (BAC)     also beat earnings expectations but CEO Brian Moynihan said Friday that the bank is preparing for rising unemployment and a recession in 2023. “Our baseline scenario contemplates a mild recession,” he said. The bank added a $1.1 billion provision for credit losses, a sharp change from last year when that number was negative.

    What’s next: Hold on to your hats. During the upcoming week, 26 S&P 500 companies are scheduled to report results for the fourth quarter.

    Apple CEO Tim Cook has responded to angry shareholders by recommending that the company cut his pay this year, reports my colleague Anna Cooban.

    Cook was granted $99.4 million in total compensation last year. The vast majority of his 2022 compensation — about 75% — was tied up in company shares, with half of that dependent on share price performance.

    But shareholders voted against Cook’s pay package after Apple’s stock fell nearly 27% last year. The vote is nonbinding, but the board’s compensation committee said Cook himself requested the reduction.

    “The compensation committee balanced shareholder feedback, Apple’s exceptional performance, and a recommendation from Mr. Cook to adjust his compensation in light of the feedback received,” the company said in its annual proxy statement released Thursday.

    But don’t cry for Tim Cook just yet. This year, the executive’s share award target is $40 million. About $30 million, or three-quarters, of that is linked to share price performance. The tech boss, who has headed up Apple

    (AAPL)     since 2011, is estimated to have a personal wealth of $1.7 billion, according to Forbes.

    The bottom line: Apple’s share price, like other tech companies, plunged last year as coronavirus lockdowns shuttered some of its factories in China. Supply chain bottlenecks and fears that a global economic slowdown would crimp demand also dragged down its stock.

    Angry investors believe that the person at the helm of the company should also see a drop in pay.

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  • George Santos said accused ‘Ponzi scheme’ he worked at was ‘100% legitimate’ when accused of fraud in 2020 | CNN Politics

    George Santos said accused ‘Ponzi scheme’ he worked at was ‘100% legitimate’ when accused of fraud in 2020 | CNN Politics



    CNN
     — 

    Republican Rep. George Santos, said a company later accused of running a “Ponzi scheme” was “100% legitimate” when it was accused by a potential customer of fraud in 2020, more than a year before it was sued by the US Securities and Exchange Commission. Once the company, where he worked, came under federal scrutiny, Santos claimed publicly that he was unaware of accusations of fraud at the firm, a CNN KFile review of Santos’ social media and statements found.

    Santos, the embattled freshman Republican, faces growing pressure to resign after he lied and misrepresented his educational, work and family history, including falsely claiming he was Jewish and the descendant of Holocaust survivors. Santos admitted to “embellishing” his resume, but has maintained he is “not a criminal.”

    Santos worked at Harbor City Capital Corp. in 2020 and 2021, a company the SEC said was a “classic Ponzi scheme” in an April 2021 complaint against the firm. A Ponzi scheme is a type of fraud where existing investors are paid with funds from new investors, often promising artificially high rates of return with little risk. Santos was not named in the SEC complaint.

    Joseph Murray, an attorney for Rep. Santos, told CNN in an email on Thursday that Santos was unaware of wrongdoing at the company.

    “As to any questions about Harbor City Capital, in light of the ongoing investigation, and for the benefit of the victims, it would be inappropriate to respond other than to say that Congressman Santos was completely unaware of any illegal activity going on at Harbor City Capital,” Murray told CNN.

    Santos told The Daily Beast in 2022 that he was “as distraught and disturbed as everyone else” to learn of allegations against Harbor City. But in a since-removed tweet on his since-deleted personal Twitter account, a potential customer questioned claims the company had a 100% bank guarantee on their investment in the form of a stand by line of credit (SBLC).

    “The market instability is leading to sever (sic) capital erosion. @HarborCityCap offers you a strategy that mitigates loss and risk while creating cash flow, meanwhile your principle is 100% secured by an SBLC held by various major institutions. #fixedincome #alternativeinvestment #win,” Santos tweeted in April 2020 under the name George Devolder, using his mother’s family name.

    In June, a potential customer responded to that tweet from Santos saying he looked into a SBLC from Harbor City and found it to be fraudulent.

    “George, this SBLC I received from Harbor City was looked into, and Deutsche Bank claims is a complete fraud and not signed by the bank officer on the document. How do you explain this?,” the user said.

    “I’m sorry I’m not following you. Could you please send me an email at George.devolder@harborcity.com and we can go over this together. Our SBLC is 100% legitimate and issued by their institution. I look forward to hearing from you,” responded Santos.

    In fact, according to the SEC complaint, “at no point” was Harbor City Capital “ever issued a SBLC,” despite claims from the company.

    Dylan Riddle, a spokesman for Deutsche Bank, told CNN on Monday that they had no affiliation with Harbor City Capital.

    “Harbor City Capital was not a client of Deutsche Bank,” he said.

    Attorney Katherine C. Donlon, the court-appointed receiver for Harbor City Capital told CNN in an email on Friday Santos was affiliated with Harbor City Capital from mid January 2020 through April 2021.

    On Wednesday, the Nassau County GOP and several New York Republican congressmen called on Santos to resign. Santos still has the tacit support of House Speaker Kevin McCarthy, who said it was up to the voters to decide.

    In other media reviewed by CNN’s KFile from 2020, Santos called himself “the head guy” at the Harbor City office in New York and the executive at the company. In one 2020 interview, Santos said he managed a $1.5 billion fund for the company with returns of 12% and 26% on investors’ money.

    “Currently at Harbor City Capital, I manage a 1.5 billion fund, right?,” said Santos. “And I know how to manage it well. I give record returns to anybody who watches this, they’ll understand. I’m giving, a 12% fixed yield income return a year, which nobody in the market’s giving four and we’re giving 12. We’re also giving up to 20 to 26% in IRR return on our investors’ capital. So if there’s something I know how to do, it’s manage dollars and grow them.”

    The SEC filed a complaint in April 2021 against Harbor City Capital and founder Jonathan P. Maroney, alleging that Maroney raised $17.1 million by deceiving more than 100 hundred investors through a series of unregistered fraudulent security offerings and used the money to enrich himself and his family. The SEC claimed that of the investor money collected and deposited into Harbor City Capital bank accounts “at most” only $449,000 were used for business expenses.

    Neither Santos nor other Harbor City Capital employees were named in the complaint.

    In October, Maroney was granted a stay in federal court for the SEC’s civil lawsuit, after Maroney noted that he “is currently the target in a related criminal investigation.” He is representing himself in the case.

    CNN reached out to Maroney for comment but did not receive a response.

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  • Bank earnings fail to impress investors as recession worries rise | CNN Business

    Bank earnings fail to impress investors as recession worries rise | CNN Business


    New York
    CNN
     — 

    JPMorgan Chase, Bank of America, Citigroup and asset management giant BlackRock posted results that topped Wall Street’s forecasts Friday, but investors were nonetheless a little disappointed at first.

    Trading was choppy, with most bank stocks falling at the open before rebounding. Shares of JPMorgan Chase

    (JPM)     were up about 2.5% in late afternoon trading while BofA

    (BAC)     was up 2%. Wells Fargo

    (WFC)    , which reported earnings that missed Wall Street’s targets, reversed earlier losses and was up 3%. Citi

    (C)     was up 2% while BlackRock

    (BLK)     was flat.

    “The earnings were solid, but the market is concerned with recession fears,” said John Curran, managing director and head of North American bank coverage at MUFG.

    Investors might have been concerned by the downbeat tone of the big banks. Executives are clearly still worried about inflation and the threat of a recession this year following several big interest rate hikes by the Federal Reserve.

    JPMorgan Chase CEO Jamie Dimon said in the bank’s earnings statement that although the economy is still strong and that consumers and businesses are spending and healthy, “we still do not know the ultimate effect of the headwinds coming from geopolitical tensions including the war in Ukraine, the vulnerable state of energy and food supplies, persistent inflation that is eroding purchasing power and has pushed interest rates higher.”

    The bank added in the earnings release that it now expects a “mild recession” as a base economic case. CFO Jeremy Barnum added during a conference call with reporters that in addition to the slowdown that has already started in its home lending unit, it is starting to see “headwinds” in auto lending.

    Meanwhile, BofA CEO Brian Moynihan noted that this is “an increasingly slowing economic environment” and Wells Fargo CEO Charlie Scharf said “we are carefully watching the impact of higher rates on our customers.” Wells Fargo recently announced plans to pull back on its massive mortgage business.

    Banks are clearly worried about a looming recession, and Wall Street has taken notice.

    Moody’s Investors Service analyst Peter Nerby noted in a report that “credit provisions are rising” at JPMorgan Chase and that Citi “built capital and reserves in anticipation of a slowdown in core markets.”

    The Fed’s rate hikes aren’t helping either.

    “Higher than expected interest rates pose a significant risk to the outlook for credit quality, loan growth and net interest margins,” said David Wagner, a portfolio manager at Aptus Capital Advisors, in an email.

    Concerns about the economy were one reason why stocks plunged in 2022, suffering their worst year since 2008. As a result of the Wall Street slump, there was a major slowdown in merger activity and initial public offerings.

    That hurt the investment banking businesses for the top banks. JPMorgan Chase and Citi each said that advisory fees plummeted nearly 60% in the quarter.

    Goldman Sachs

    (GS)     and Morgan Stanley

    (MS)     will give more color about the health of Wall Street next Tuesday when they both report their fourth quarter results.

    Goldman Sachs, which has aggressively built up a consumer banking unit over the past few years, has struggled to make money in that division. Goldman Sachs disclosed in a regulatory filing Friday that it has lost more than $3 billion in its consumer business since 2020.

    There were some signs of optimism though. BlackRock, which owns the massive iShares family of exchange-traded funds, reported a rebound in assets under management from the third quarter to the fourth quarter as stocks soared in October and November.

    “The current environment offers incredible opportunities for long-term investors,” said BlackRock CEO Larry Fink in the earnings release.

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  • Fed Chair Powell: Bringing down inflation requires ‘measures that are not popular’ | CNN Business

    Fed Chair Powell: Bringing down inflation requires ‘measures that are not popular’ | CNN Business


    New York
    CNN
     — 

    Investors shifted their focus Tuesday from the stock market to Stockholm as Federal Reserve Chairman Jerome Powell made his first public appearance of the year.

    Powell participated in a panel discussion on central bank independence at an event hosted by Sweden’s central bank, the Sveriges Riksbank.

    The painful rate hikes the Fed is implementing to try to bring down inflation don’t make officials particularly popular, Powell admitted.

    “Restoring price stability when inflation is high can require measures that are not popular in the short term as we raise interest rates to slow the economy,” he said, before adding that it’s important not to succumb to the need to liked.

    “We should ‘stick to our knitting’ and not wander off to pursue perceived social benefits that are not tightly linked to our statutory goals and authorities,” Powell said.

    He highlighted climate change as a prime example of this.

    “Today, some analysts ask whether incorporating into bank supervision the perceived risks associated with climate change is appropriate, wise, and consistent with our existing mandates,” he said. “in my view, the Fed does have narrow, but important, responsibilities regarding climate-related financial risks. These responsibilities are tightly linked to our responsibilities for bank supervision. The public reasonably expects supervisors to require that banks understand, and appropriately manage, their material risks, including the financial risks of climate change.”

    US inflation rates (as measured by the Labor Department’s Consumer Price Index) have been steadily falling for the past five months. That has enabled the Fed to start easing back on the size of its historically high rate hikes meant to cool the economy and fight rising prices.

    Inflation in the Eurozone, meanwhile, remains at an eye-popping 9.2% — though it eased between November and December. ECB president Christine Lagarde said last month she expects interest rate hikes to rise “significantly further, because inflation remains far too high and is projected to stay above our target for too long.”

    “If you compare with the Fed, we have more ground to cover. We have longer to go,” she added.

    The Bank of England, meanwhile, has also warned that inflation, still at its highest level since the 1980s, isn’t going anywhere. The BoE’s chief economist Huw Pill said this week that inflation could persist for longer than expected despite recent falls in wholesale energy prices and an economy on the brink of recession.

    These three central banks are fighting in different conditions, but they share a similar battle strategy: Keep tightening.

    The central bankers defended the importance of independence and credibility for their institutions, which has come under fire as policymakers are accused of having let surging inflation go unchecked for too long.

    December meeting minutes from the Fed, released last week, noted that the policymaking committee would “continue to make decisions meeting by meeting,” leaving options open for the size of rate hikes at the next monetary policy decision on February 1. No policymakers have forecast that it would be appropriate to reduce the bank’s benchmark borrowing rate this year. And while officials welcomed the recent softening in inflation, they stressed that “substantially more evidence” was required for a Fed “pivot.”

    Last week’s jobs report further muddied the picture, showing that employment remained strong while wage growth eased.

    Thursday’s CPI for December — which will be the new year’s first check on inflation — will also provide helpful clues to investors about whether US price hikes are sufficiently cooling.

    Encouraging data could bolster consensus estimates that call for a quarter-percentage point interest rate hike in February, a shift lower from December’s half-point hike and the four prior three-quarter-point hikes.

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  • A Wall Street Journal reporter was handcuffed by police while standing outside a Chase Bank. The newspaper is demanding answers | CNN Business

    A Wall Street Journal reporter was handcuffed by police while standing outside a Chase Bank. The newspaper is demanding answers | CNN Business


    New York
    CNN
     — 

    The Wall Street Journal is demanding answers from the Phoenix Police Department after an officer detained and handcuffed one of its reporters outside a Chase Bank — an incident that press freedom advocates say raises First Amendment concerns and mirrors a larger, growing hostility from local law enforcement toward journalists across the country.

    The incident between The Journal reporter Dion Rabouin and the Phoenix officer occurred in late November, but just became public his week after ABC affiliate KNXV reported on the matter. In a statement, The Journal said that it is “deeply concerned” with how its reporter was treated and has asked the Phoenix Police Department to conduct an investigation.

    “No journalist should ever be detained simply for exercising their First Amendment rights,” The Journal said.

    A version of this article first appeared in the “Reliable Sources” newsletter. Sign up here for the daily digest chronicling the evolving media landscape

    In response, the Phoenix Police Department — which is being probed by the Department of Justice to determine whether its officers retaliate against people “for conduct protected by the First Amendment” — stressed to me that the incident occurred on private property, but that the department had nonetheless shared concerns raised by the paper with the Professional Standards Bureau andthat an investigation is underway.

    At the crux of this particular matter is a rather innocent act of journalism. While visiting family in Arizona for the Thanksgiving holiday, Rabouin attempted to interview passersby on a sidewalk outside a Chase branch for an ongoing story about savings accounts, he told the Phoenix affiliate.

    Representatives from the bank approached him and asked what he was doing and Rabouin said he identified himself as a journalist. Rabouin said he was never asked to leave, but an officer soon arrived on the scene.

    Rabouin said he volunteered to simply stop reporting from the scene, but video captured by a bystander shows the responding officer handcuff him, put him in the back of a police vehicle, and even threaten to shove him in if he did not comply. The video shows Rabouin repeatedly identified himself as a reporter for The Journal, but the officer did not appear to care. The bystander who began recording the incident was also threatened with arrest.

    Ultimately, after about 15 minutes, when other officers showed up, Rabouin was allowed to walk free. A representative for Chase told me Thursday that the bank did apologize to Rabouin over the incident. But the local police department has thus far refrained from doing so.

    In a letter dated December 7 from Journal Editor-In-Chief Matt Murray to Phoenix Police Department Interim Chief Michael Sullivan, the editor described the officer’s conduct as “offensive to civil liberties,” and demanded to know what steps the department will take to “ensure that neither Mr. Rabouin nor any other journalist is again subjected to such conduct.” The Journal told me Thursday that Murray has not received a response from Sullivan.

    For press freedom advocates, the incident is representative of countless others that take place around the US each year. According to the US Press Freedom Tracker, at least 218 journalists have been arrested in the country since 2020.

    Bruce Brown, the executive director of the Reporters Committee for Freedom of the Press, told me in a statement that “the alarming number of incidents we’ve seen over the last several years where police have detained, arrested, or assaulted journalists who were doing their jobs threatens to chill this kind of essential newsgathering.”

    Brown added, “It’s time for the law enforcement community to hold itself accountable for its actions. The Phoenix Police Department can start now.”

    The Committee to Protect Journalists has also sounded the alarm over the incident. Katherine Jacobsen, the organization’s US and Canada program director, told me the detention of Rabouin “highlights a very real threat faced by reporters – especially local reporters – across the country.” Jacobsen went on to say that it is “disheartening to see acts of hostility toward journalists working in the United States.”

    Through a spokesperson, Rabouin declined to comment to me on Thursday. But he did post one tweet about the matter.

    “Thanks to everyone who has reached out to offer support,” Rabouin wrote. “We’re hoping to hear back from the chief or someone at the department soon.”

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  • ‘Life or death.’ As Britons buckle under the cost of living crisis, many resort to ‘warm banks’ for heat this winter | CNN

    ‘Life or death.’ As Britons buckle under the cost of living crisis, many resort to ‘warm banks’ for heat this winter | CNN


    London
    CNN
     — 

    In a community center in central London, a young child plays in a makeshift area as her caregiver rocks her stroller and chats to a friend.

    The Oasis Centre in Waterloo sits in a four-story building that has a warm, inviting feeling, with plush chairs and lots of potted plants.

    But it’s not your regular high street hangout. This is a haven for families and local people to escape the bitter squeeze of Britain’s cost-of-living crisis – if only for the afternoon.

    Thousands of warm banks have opened their doors across the UK this winter, as household budgets are squeezed even further by spiking energy bills and inflation reaches a 40-year high, leaving many scrambling to pay for basic necessities. There are more than 3,000 registered organizations running warm banks in Britain, according to the Warm Welcome Campaign, an initiative that signposts community-led responses to the cost-of-living crisis.

    “A lot of people are struggling,” Charlotte, a community and families worker at the center, tells CNN. Her full name is not being disclosed for privacy reasons.

    “We haven’t even really got to the peak of the living crisis yet,” the 33-year-old mother-of-four adds. “No one should be choosing whether to put food on the table or to put the heating on.”

    The hub is funded by donations from individuals and local businesses, as well as grant incomes from charitable trusts.

    The cost of living has risen sharply since early 2021, according to data from the UK government. From October 2021 to October 2022, domestic gas and electricity prices increased by 129% and 66% respectively, the same research found.

    The average annual energy bill surged 96% from last autumn to £2,500 (roughly $3,000), with the UK government intervening to cap the unit cost of gas and electricity bills at that level until April 2023. However, the total amount consumers pay for their energy depends on their consumption habits, where they live, how they pay for energy and what type of meter they use, according to the UK’s regulator, Ofgem.

    A welcoming sign outside the Oasis Centre, an open to all communal area which acts as a 'warm bank', in London, on December 12.

    Charlotte, who works at and uses the warm space in Waterloo, says she limits her gas and electricity use in her flat. Instead of turning on the heating in the evening, she and her partner sit under quilts and use hot water bottles to stay warm, she says.

    She also anticipates her household energy costs increasing over Christmas, as her children, who are between 4 and 17 years old, spend more time at home during the school holidays. At the moment, Charlotte spends most days at the hub and said this habit will continue over the holidays to help alleviate her costs at home.

    Grace Richardson is an adult services manager at Future Projects in Norwich, in eastern England, an organization that offers health, housing and financial support to residents. She says her team started planning over the summer to provide a warm space in the organization’s Baseline Centre, located in an area with significant poverty.

    “This winter in particular, it’s extremely important that we’re offering a space that people can turn everything off at home and they can save money,” she tells CNN.

    “We’ve got people here working full time and they cannot make ends meet. That’s where the real difference is.”

    From young parents to pensioners to students in their 20s, Richardson says that people from all walks of life use the warm space, with about 25 attending each day. The warm bank, where staff serve meals, is subsidized by grant funding from the local council and private or corporate foundations, as well as donations from individuals.

    The café space at Future Projects' Baseline Centre in Norwich. The Centre, which serves as a community space, is currently undergoing renovation.

    Michael John Edward Easter, 57, says the service at the Baseline Centre has been a lifeline for him this winter.

    Easter, who has lymphedema in both legs and arthritis in one knee, is unable to work. Speaking to CNN earlier this month, he said he’d turned the heating on in his one-bedroom flat just twice so far this year to avoid spiking energy costs and compensate for a 50% increase in his weekly supermarket bill.

    He says he “was in a mess” when he first reached out to the Baseline Centre in January for welfare advice, as he was dealing with mobility challenges and craved a sense of community.

    “I was so ashamed and embarrassed, but I had to cry out for help,” he says. “I needed help and I just didn’t know where to turn to. If I’m totally honest, I’m very lonely.”

    Richardson suggests the need for warm banks is a result of government inaction.

    “I think that it highlights just how far removed our government is right now from the reality of real life. I think it screams … the divide between us and them, it’s only getting wider,” she says. “We keep referring to this as a cost of living crisis, as though it’s a period of time we’re going to go through and we will come out the other side. Will we? It’s life or death.”

    Energy prices have soared across Europe since fall 2021, driven in part by Russia’s war in Ukraine. But UK energy prices rose more sharply than in comparable economies such as France and Italy, analysts told CNN Business this summer.

    In November, UK Prime Minister Rishi Sunak and Finance Minister Jeremy Hunt announced higher taxes and reduced public spending in an effort to heave the country out of a recession forecast to last just over a year and shrink its economy by just over 2%, according to the Office for Budget Responsibility. The UK is the only G7 economy that remains smaller than it was before the coronavirus pandemic, according to the Office for National Statistics.

    Snow-covered roofs on terraced houses in Aldershot, UK, on December 12. UK power prices jumped to record levels just as a lengthy spell of freezing temperatures caused a surge in demand.

    The UK government also announced an Energy Bill Support Scheme worth £400 per eligible household, which will partially subsidize domestic energy bills from winter 2022 to 2023, as well as providing extra financial support to help pensioners pay their heating costs this winter under the Winter Fuel Payment scheme.

    In December more than one million households with prepayment meters did not redeem their monthly energy support vouchers – included in the government’s Energy Bill Support Scheme – the BBC reported.

    But Michael Marmot, a lead researcher in epidemiology and health inequalities, says years of austerity, paltry government support, cuts to spending on social welfare and infrastructure, and a lack of regulation in the UK’s energy market have plunged millions into fuel poverty.

    “Poverty has been building up over the last dozen years and getting worse,” says Marmot, director of University College London’s Institute of Health Equity.

    “We look the worst in G7 countries, we’re the only one in terms of recovery … that hasn’t gone back to where we were pre-pandemic. This is mismanagement on a colossal scale.”

    An estimated 3.69 million households in the UK were in fuel poverty as of December 2020 compared with 6.99 million households in December 2022, Simon Francis, who coordinates the End Fuel Poverty Coalition, told CNN.

    This figure is set to steadily increase, with more than three-quarters of UK households – 53 million people – forecast to be in fuel poverty by the new year, according to research by the University of York in northern England.

    The human rights organization Save the Children has distributed 2,344 direct grants to low-income families in the UK in the past year, the Guardian reported. The head of the charity also called on the government to provide more support for families, as it predicts acute financial hardship for millions in January.

    “What do you want a well-functioning society to do? At the minimum, people should be able to eat, to feed their families, have a safe dwelling … and a safe dwelling includes one that’s warm enough,” Marmot adds.

    Flyers advertising the warm spaces service alongside complimentary refreshments for visitors, at the Ashburton Hall community hub, operated by Greenwich Leisure Ltd., in Croydon, UK, on December 15.

    Susan Aitken, leader of Glasgow City Council in Scotland, says warm banks are “not a solution” to the cost of living crisis but rather “an emergency service.” The council has established more than 30 warm banks across the city in spaces including church halls, libraries, sports venues and cafes, and that number is expected to increase, according to Aitken. The service runs on council budgets and charitable donations.

    “The solution is for people to be able to stay in their own homes,” she says.

    “It’s bad enough that food banks have become a permanent fixture of communities across the UK now. To have places that people have to go to because they can’t afford to heat their own home is an absolute indictment (of government policy).”

    CNN has reached out to the UK government for comment, but it did not respond.

    Back at the Oasis Centre, locals show up for anything from knitting circles to after-school clubs offering free hot meals.

    Steve Chalke, the hub’s founder, says about 200 people use the facility daily for warmth. He says that he does not advertise the service as a warm bank because it is “dehumanizing.” Instead, he coordinates community-led events that are held in warm venues across the city.

    “The idea is to not inquire and to not ask,” he says. “It’s stigmatizing and it’s traumatizing, you know, so you end up feeling a non-person. So we want to take away that stigma in every way we can.”

    Steve Chalke, founder of the Oasis Centre, at the hub in Waterloo, London, on December 1.

    Francis, the End Fuel Poverty Coalition coordinator, says one of the most significant challenges to curbing fuel poverty is removing the taboo that people may feel when asking for support.

    “I think one of the problems with fuel poverty … is it is quite a hidden form of poverty. People kind of … try and cover it up and try and get by,” he says. “We’re not going to know the full extent of the pain that people are suffering this winter, because there will be ways that people will disguise what it is that they’re doing.”

    The mental health costs of fuel poverty are far-reaching, according to a 2020 report from the UCL Institute of Health Equity. The report said that young people living in cold homes are seven times more likely to have symptoms of poor mental health compared with those living in warm homes.

    “There’s surprisingly lots of people that do have work, but yet it’s not enough to keep afloat, at least without needing some help,” says Bintu Tijani, a mother-of-four who goes to the Oasis Centre at least three times a week to warm up. “It’s having a significant impact on people’s wellbeing, mental health and wellbeing.”

    Looking ahead to Christmas and the New Year, Francis says he is also concerned about the strain that treatment needed for medical conditions exacerbated or caused by cold weather will have on Britain’s National Health Service (NHS).

    “We’re still calling for the government to realize that if it doesn’t take action to support those who are the most vulnerable … it is going to see a huge increase in the number of people turning up at the NHS’ door to seek help because of the fact that they are now living in a cold, damp home and it is making them sick,” he says.

    Britain’s NHS is already under pressure amid staff shortages, historic nurses’ strikes over poor pay and working conditions, and a backlog of treatments resulting from the coronavirus pandemic.

    Aitken, the councilor in Glasgow, believes this Christmas will “be a pretty miserable time” for many.

    “A Christmas where you have to ration how long you can put your heating on in your home is not a good Christmas for anyone.”

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  • Here’s what’s in the $1.7 trillion federal spending bill | CNN Politics

    Here’s what’s in the $1.7 trillion federal spending bill | CNN Politics



    CNN
     — 

    Senate leaders unveiled a $1.7 trillion year-long federal government funding bill early Tuesday morning.

    The legislation includes $772.5 billion for non-defense discretionary programs and $858 billion in defense funding, according to a bill summary from Democratic Sen. Patrick Leahy, chair of the Senate Committee on Appropriations.

    The sweeping package includes roughly $45 billion in emergency assistance to Ukraine and NATO allies, boosts in spending for disaster aid, college access, child care, mental health and food assistance, more support for the military and veterans and additional funds for the US Capitol Police, according to Leahy’s summary and one from Sen. Richard Shelby of Alabama, the top Republican on the Senate Appropriations Committee.

    However, the bill, which runs more than 4,000 pages, left out several measures that some lawmakers had fought to include. An expansion of the child tax credit, as well as multiple other corporate and individual tax breaks, did not make it into the final bill. Neither did legislation to allow cannabis companies to bank their cash reserves – known as the Safe Banking Act. Also, there was also no final resolution on where the new FBI headquarters will be located.

    The spending bill is the product of lengthy negotiations between top congressional Democrats and Republicans. Lawmakers reached a “bipartisan, bicameral framework” last week following a dispute between the two parties over how much money should be spent on non-defense domestic priorities. They worked through the weekend to craft the legislation.

    The Senate is expected to vote first to approve the deal this week and then send it to the House for approval before government funding runs out on December 23. The bill would keep the government operating through September, the end of the fiscal year.

    Congress originally passed a continuing resolution on September 30 to temporarily fund the government in fiscal year 2023, which began October 1.

    More aid for Ukraine: The spending bill would provide roughly $45 billion to help support Ukraine’s efforts to defend itself against Russia’s attack.

    About $9 billion of the funding would go to Ukraine’s military to pay for a variety of things including training, weapons, logistics support and salaries. Nearly $12 billion would be used to replenish US stocks of equipment sent to Ukraine through presidential drawdown authority.

    Also, it would provide $13 billion for economic support to the Ukrainian government.

    Other funds would address humanitarian and infrastructure needs, as well as support European Command operations.

    Emergency disaster assistance: The bill would appropriate more than $38 billion in emergency funding to help Americans in the west and southeast affected by recent natural disasters, including tornadoes, hurricanes, flooding and wildfires. It would aid farmers, provide economic development assistance for communities, repair and reconstruct federal facilities and direct money to the Federal Emergency Management Agency’s Disaster Relief Fund, among other initiatives.

    Overhaul of the electoral vote counting law: A provision in the legislation aims at making it harder to overturn a certified presidential election, in a direct response to the January 6 attack on the US Capitol.

    The changes would overhaul the 1887 Electoral Count Act, which then-President Donald Trump tried to use to overturn the 2020 election.

    The legislation would clarify the vice president’s role while overseeing the certification of the electoral result to be completely ceremonial. It also would create a set of stipulations designed to make it harder for there to be any confusion over the accurate slate of electors from each state.

    Higher maximum Pell grant awards: The bill would increase the maximum Pell grant award by $500 to $7,395 for the coming school year. This would be the largest boost since the 2009-2010 school year. About 7 million students, many from lower-income families, receive Pell grants every year to help them afford college.

    Increased support for the military and veterans: The package would fund a 4.6% pay raise for troops and a 22.4% increase in support for Veteran Administration medical care, which provides health services for 7.3 million veterans.

    It would include nearly $53 billion to address higher inflation and $2.7 billion – a 25% increase – to support critical services and housing assistance for veterans and their families.

    The bill also would allocate $5 billion for the Cost of War Toxic Exposures Fund, which provides additional funding to implement the landmark PACT Act that expands eligibility for health care services and benefits to veterans with conditions related to toxic exposure during their service.

    Beefing up nutrition assistance: The legislation would establish a permanent nationwide Summer EBT program, starting in the summer of 2024, according to Share Our Strength, an anti-hunger advocacy group. It would provide families whose children are eligible for free or reduced-price school meal with a $40 grocery benefit per child per month, indexed to inflation.

    It would also change the rules governing summer meals programs in rural areas. Children would be able to take home or receive delivery of up to 10 days worth of meals, rather than have to consume the food at a specific site and time.

    The bill would also help families who have had their food stamp benefits stolen since October 1 through what’s known as “SNAP skimming.” It would provide them with retroactive federal reimbursement of the funds, which criminals steal by attaching devices to point-of-sale machines or PIN pads to get card numbers and other information from electronic benefits transfer cards.

    More money for child care: The legislation would provide $8 billion for the Child Care and Development Block Grant, a 30% increase in funding. The grant gives financial assistance to low-income families to afford child care.

    Also, Head Start would receive nearly $12 billion, an 8.6% boost. The program helps young children from low-income families prepare for school.

    Help to pay utility bills: The bill would provide $5 billion for the Low Income Home Energy Assistance Program. Combined with the $1 billion contained in the earlier continuing resolution, this would be the largest regular appropriation for the program, according to the National Energy Assistance Directors Association. Home heating and cooling costs – and the applications for federal aid in paying the bills – have soared this year.

    Enhance retirement savings: The bill contains new retirement rules that could make it easier for Americans to accumulate retirement savings – and less costly to withdraw them. Among other things, the provisions would allow penalty-free withdrawals for some emergency expenses, let employers offer matching retirement contributions for a worker’s student loan payments and increase how much older workers may save in employer retirement plans.

    More support for the environment: The package would provide an additional $576 million for the Environmental Protection Agency, bringing its funding up to $10.1 billion. It would increase support for enforcement and compliance, as well as clean air, water and toxic chemical programs, after years of flat funding.

    It also would boost funding for the National Park Service by 6.4%, restoring 500 of the 3,000 staff positions lost over the past decade. This would be intended to help the agency handle substantial increases in visitation.

    Plus, the legislation would provide an additional 14% in funding for wildland firefighting.

    Additional funding for the US Capitol Police: The bill would provide an additional $132 million for the Capitol Police for a total of nearly $735 million. It would allow the department to hire up to 137 sworn officers and 123 support and civilian personnel, bringing the force to a projected level of 2,126 sworn officers and 567 civilians.

    It would also give $2 million to provide off-campus security for lawmakers in response to evolving and growing threats.

    Investments in homelessness prevention and affordable housing: The legislation would provide $3.6 billion for homeless assistance grants, a 13% increase. It would serve more than 1 million people experiencing homelessness.

    The package also would funnel nearly $6.4 billion to the Community Development Block Grant formula program and related local economic and community development projects that benefit low- and moderate income areas and people, an increase of almost $1.6 billion.

    Plus, it would provide $1.5 billion for the HOME Investment Partnerships Program, which would lead to the construction of nearly 10,000 new rental and homebuyer units and maintain the record investment from the last fiscal year.

    Increased health care funding: The package would provide more money for National Institutes of Health, the Centers for Disease Control and Prevention and the Assistant Secretary for Preparedness and Response. The funds are intended to speed the development of new therapies, diagnostics and preventive measures, beef up public health activities and strengthen the nation’s biosecurity by accelerating development of medical countermeasures for pandemic threats and fortifying stockpiles and supply chains for drugs, masks and other supplies.

    More resources for children’s mental health and for substance abuse: The bill would provide more funds to increase access to mental health services for children and schools. It also would invest more money to address the opioid epidemic and substance use disorder.

    Tiktok ban from federal devices: The legislation would ban TikTok, the Chinese-owned short-form video app, from federal government devices.

    Some lawmakers have raised bipartisan concerns that China’s national security laws could force TikTok – or its parent, ByteDance – to hand over the personal data of its US users. Recently, a wave of states led by Republican governors have introduced state-level restrictions on the use of TikTok on government-owned devices.

    Enhanced child tax credit: A coalition of Democratic lawmakers and consumer advocates pushed hard to extend at least one provision of the enhanced child tax credit, which was in effect last year thanks to the Democrats’ $1.9 trillion American Rescue Plan. Their priority was to make the credit more refundable so more of the lowest-income families can qualify. Nearly 19 million kids won’t receive the full $2,000 benefit this year because their parents earn too little, according to a Tax Policy Center estimate.

    New cannabis banking rules: Lawmakers considered including a provision in the spending bill that would make it easier for licensed cannabis businesses to accept credit cards – but it was left out of the legislation. Known as the Safe Banking Act, which previously passed the House, the provision would prohibit federal regulators from taking punitive measures against banks for providing services to legitimate cannabis businesses.

    Even though 47 states have legalized some form of marijuana, cannabis remains illegal on the federal level. That means financial institutions providing banking services to cannabis businesses are subject to criminal prosecution – leaving many legal growers and sellers locked out of the banking system.

    FBI headquarters: There was also no final resolution on where the new FBI headquarters will be located, a major point of contention as lawmakers from Maryland – namely House Majority Leader Steny Hoyer – pushed to bring the law enforcement agency into their state. In a deal worked through by Senate Majority Leader Chuck Schumer, the General Services Administration would be required to conduct “separate and detailed consultations” with Maryland and Virginia representatives about potential sites in each of the states, according to a Senate Democratic aide.

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  • First images of British banknotes featuring King Charles III unveiled | CNN Business

    First images of British banknotes featuring King Charles III unveiled | CNN Business


    London
    CNN Business
     — 

    The first images of banknotes featuring Britain’s King Charles III were unveiled on Tuesday by the Bank of England.

    Charles’ portrait will appear on English notes of £5, £10, £20 and £50. Meanwhile, the rest of the design will remain the same as the current notes that feature the late Queen Elizabeth II on the front. The cameo in the transparent security window will also feature the current monarch, the United Kingdom’s central bank said in a press release.

    The new banknotes are expected to enter circulation by mid-2024 and will co-circulate with notes featuring the Queen’s portrait, which will remain legal tender in the UK, according to the bank.

    “This is a significant moment, as The King is only the second monarch to feature on our banknotes,” Bank of England Governor Andrew Bailey said ahead of the release.

    The reverse side of the notes will remain unchanged – the current designs feature portraits of Winston Churchill, Jane Austen, JMW Turner and Alan Turing on the reverse of the £5, £10, £20 and £50 notes, respectively.

    “To minimize the environmental and financial impact of this change, new notes will only be printed to replace worn banknotes and to meet any overall increase in demand for banknotes,” the Bank of England added.

    Earlier this month, the first coins bearing the official effigy of King Charles III entered circulation. The 4.9 million 50 pence coins feature the King’s portrait, and on the reverse, a design symbolizing the “life and legacy” of the late Queen, according to the Royal Mint.

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