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TD Plans to Expand, Citi Focuses on an IPO, and Credit Unions Salute Veterans this Memorial Day
Higher interest rates have both helped and hindered commercial banking and fintechs alike.
Anna Lad
May 26, 2023
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Banking News
Canada-based TD to Expand into Southeast US
The American arm of Canada-based TD Bank has announced plans to expand into the southeastern United States. The bank aims to open 150 branches by 2027 and double its hiring of wealth advisers.
This expansion comes after TD's failed acquisition of First Horizon, which would have increased its southeastern presence. TD will target South Florida, Atlanta, and North Carolina, with 13 new branches scheduled to open in 2023. The bank will focus on organic growth and strategic opportunities. TD has significant excess capital following the failed acquisition and intends to buy back 30 million shares.
No Mexico Sale for Citi
CitiBank is pursuing an initial public offering (IPO) instead of selling its Mexican small-business, middle-market, and consumer banking operations. The separation of businesses will likely finish in the second half of 2024, while the IPO will occur in 2025. Citi had been in talks to sell its Mexico retail operations to Grupo Mexico, but the deal faced challenges including demands from Mexican President López Obrador. Citi will now focus on an IPO to maximize the value of Banamex, its Mexican subsidiary.
Jane Fraser, Citi CEO, said
After careful consideration, we concluded the optimal path to maximizing the value of Banamex for our shareholders and advancing our goal to simplify our firm is to pivot from our dual path approach to focus solely on an IPO of the business.
Credit Union News
Military-focused CU Celebrates Memorial Day
The Defense Credit Union Council (DCUC) encourages reflection on the true meaning of Memorial Day. They suggest incorporating a flag tradition to honor fallen servicemembers and highlight an "Honor and Remember" video as a way to express gratitude to the military and veterans. DCUC is enthusiastic about the positive impact credit unions can have on those who have served for the United States.
More Low Risk Loans Available at Iowa CUs
Thanks to a partnership between the Credit Union Loan Source (CULS) and the Iowa Credit Union League (ICUL), more low-risk loans will be available to members of credit unions across Iowa. A major program benefit for the credit unions is a subscription model that renews monthly. Two early adopters are Financial Plus Credit Union and Members Community Credit Union.
COO Matt Oakley of ICUL said
[CULS] has a long track record of success, and their loans are low risk but can provide an excellent source of revenue, which will feed back to Iowa credit union members throughout the state.
Financial Services & Blockchain
Surveys from Dave Pay Out $1M+
Collective earnings from customers of neobank and personal finance app Dave total $1M+, thanks to the app’s survey feature. The feature, which debuted in December as part of Dave's Side Hustle program, allows users to earn up to $5 per survey, with cash being deposited into their accounts immediately after completion. The in-app surveys aim to help users supplement their income. Dave partnered with inBrain.ai, owned by Dynata, to deliver the survey product and ensure user security. The feature has been well-received, with users using their survey earnings for various financial goals.
Jason Wilk, Dave CEO, said:
Many members have earned hundreds of dollars – helping them buy groceries, fill up their gas tanks, pay bills, or any number of costs Americans are battling amid heightened inflation.
Daylight, LGBT+ Focused Neobank, Closes
The queer-focused neobank, which emphasized family planning for LGBT couples, will close June 30. Challenges for the digital bank included higher interest rates, a lawsuit alleging discrimination and retaliation, and a concentration of their deposits in SVB, which failed in March. It’s unlikely that larger banks will acquire Daylight because of the lawsuit risk. Rob Curtis, Daylight CEO, hopes that larger banks will adopt Daylight’s goals in the years to come.
Market Movements (5.22-5.26)
