First Republic Branch Closures & OneMain Pays $20M in Fines

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Banking News

21 First Republic Branches to Close

JPMorgan Chase will close 21 First Republic branches by the end of the year, affecting approximately 1000+ employees. The closures are due to low transaction volumes and proximity to existing Chase branches. Some branches will be converted into wealth centers, and affected employees will be offered transition assignments or opportunities for redeployment within JPMorgan Chase.

OneMain Financial Pays $20M in CFPB Fines

OneMain Financial, based in Evansville, Indiana, will pay $20 million in fines and redress to settle allegations by the Consumer Financial Protection Bureau (CFPB). The nonbank lender is accused of deceiving customers into purchasing add-on products to obtain loans and failing to refund interest. OneMain will pay $10 million in refunds to affected customers and an additional $10 million penalty to the CFPB's victims relief fund. The CFPB found that OneMain incentivized upselling by employees, leading customers to believe that add-on products were necessary for loan approval.

Director of the CFPB, Rohit Chopra, said,

Credit Union News

Woman-to-Woman Mentoring Strengthens CUs

The 1-to-1Woman Mentoring Program, sponsored by the American Association of Credit Union Leagues (AACUL), successfully crafted 9 mentor relationships between C-suite Caucasian professional women and up-and-coming Black professional women. The program was developed in order to introduce diversity of race and gender into the male-dominated world of finance. Mentors guide and teach their mentees based on their own experiences and challenges. They also had the opportunity to learn from their mentees.

Chelsea Best, a mentee from Callahan & Associates, said:

Home-Buying Nondiscrimination Measures Strengthened

The Biden administration is taking steps to address racial bias in home valuations. The proposed rule by NCUA and other regulators requires institutions to adopt policies and standards for Automated Valuation Models (AVMs) to ensure credibility, integrity, and compliance with nondiscrimination laws. Additional efforts include guidance on reconsiderations of value (ROV), a working group to develop standards for FHA, Fannie Mae, and Freddie Mac lenders, updates to appraisal datasets, and the creation of a dashboard on barriers to entry in the appraiser market.

Financial Services & Blockchain

Dragonfly Leads Foray into ‘Composable Banking’

Cash management firm Dragonfly Financial Technologies is leading the way in the adoption of "composable" banking, an approach that offers flexibility and technology-enabled financial product delivery. The platform offers multiple implementation options, such as a fully featured user interface, a headless platform with API integration, and the ability to embed services in fintech apps. Composable banking aims to meet evolving customer needs, enhance user experience, and allow banks to expand their digital services. The adoption of composable banking is seen as a way for banks to offer personalized experiences, improve agility, and integrate with external systems to meet customer expectations.

CEO of Starling Bank, Anne Boden, said:

Cowen Digital Shut Down by TD

Boutique investment bank Cowen has shut down its cryptocurrency arm, Cowen Digital, according to internal emails. Cowen Digital, which launched in March 2022, aimed to provide institutional clients with access to the crypto market. The closure comes amid a challenging regulatory environment and the changing crypto landscape. Cowen Digital may continue operations as a separate organization. Digital Currency Group also recently announced the wind-down of its trade execution and prime brokerage subsidiary, TradeBlock, citing similar challenges.