Small banks you’ve never heard of are quietly enabling the tech takeover of the financial industry

Instead of trying to beat a wave of high-growth financial technology startups at their own game, a group of small banks is opting to join them. These low …

In order to take customer deposits in the United States, a company needs federal deposit insurance. It’s an elite club that is not eagerly looking for members.

“It’s very difficult, if not impossible for a nonbank to get an account with the Fed,” said Amias Gerety, partner at QED Investors and a former acting assistant secretary at the U.S. Department of the Treasury. “Through that you can get access to the payment system the Fed controls.”

That gives the community banks that work with fintechs some breathing room for now, but competition looms. The Office of the Comptroller of the Currency is accepting applications for a national fintech charter, which would give the agency more direct oversight instead of regulating their partner banks.

“It’s awkward to regulate these fintech companies indirectly, so the thought is, if we give them a charter we can regulate them directly with a bit more clarity,” Gerety said.

Companies can also apply to be an industrial loan company, or ILC, which allows nonbanks to lend money, issue consumer and commercial loans, and accept federally insured deposits. Wal-Mart fought hard for the designation in the early 2000’s but dropped its application following a backlash from banking officials, watchdog groups and lawmakers.

More recently, fintech payments company Square refiledwith the FDIC for a special ILC license that among other things would allow it to accept government-insured deposits. It pulled its first application in July, but the company was clear back then that it intended to refile after it could “amend and strengthen” the application.

Square, run by Twitter founder Jack Dorsey, already has a small-business lending arm through Square Capital, which operates through Celtic Bank in Salt Lake City, Utah.

Varo Money, a mobile-only banking start-up, made history as the first fintech to receive preliminary approval for a national bank charter from the OCC. They still need full approval from the agency, as well as FDIC approval, according to the CEO.

Varo’s co-founder and CEO Colin Walsh led Europe’s largest consumer credit and charge card business at American Express. He said he knew the process wasn’t going to be easy, and it still relies on its bank partnership until the approvals are completed. But it wanted to go out on its own.

“With a partnership, you’re beholden to the success of the bank, anything that they could do right or wrong that could limit your success,” said Walsh, who was also a managing director at Lloyd’s Banking Group in London. “I think that’s the No. 1 thing here, is to control your own destiny — we wanted a broader set of permissions.”

Other fintechs are less eager to leave their banking relationships. Chime, an online-only bank, said it may consider going the banking route eventually. But for now, CEO Chris Britt said it can focus on building the platform and customer experience.

“Becoming a bank right now hasn’t been a top priority for us,” said Britt, a former executive at Green Dot and Visa before co-founding Chime. “I could imagine over time it’s something we might want to explore and we’re seeing other companies exploring that notion.”

This is completely new territory for most regulators. With the financial crisis fresh in the mind of most Americans, they are careful not to open the floodgates too quickly. The bar is especially high in the U.S., and fintechs that want to become a bank need to prove they can provide the safety and soundness.

“Regulators are going to take a long look at this and ask, ‘Who’s running this thing?'” said Donald Powell, a former FDIC chairman. “You need to go in the front door, and not the back door or the side door.”

The United Kingdom is more open to “challenger banks.” The Competition and Markets Authority, or CMA, made it easier for these start-ups to enter the retail banking market after 2008, allowing firms such as Revolut to pass the billion-dollar valuation mark. The mobile-based bank said earlier this year it plans to expand into the United States and Canada.

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Victory Capital Management Inc. Reduces Position in Columbia Banking System Inc (COLB)

Man Group plc grew its stake in shares of Columbia Banking System by 410.2% in the 3rd quarter. Man Group plc now owns 144,987 shares of the …

Columbia Banking System logoVictory Capital Management Inc. lessened its position in shares of Columbia Banking System Inc (NASDAQ:COLB) by 7.5% during the fourth quarter, according to its most recent filing with the Securities & Exchange Commission. The fund owned 1,780,318 shares of the financial services provider’s stock after selling 144,745 shares during the quarter. Victory Capital Management Inc. owned about 2.43% of Columbia Banking System worth $64,608,000 as of its most recent SEC filing.

A number of other large investors have also recently added to or reduced their stakes in COLB. BlackRock Inc. grew its stake in Columbia Banking System by 3.8% during the 3rd quarter. BlackRock Inc. now owns 10,518,708 shares of the financial services provider’s stock worth $407,811,000 after buying an additional 381,970 shares during the last quarter. Vanguard Group Inc grew its stake in shares of Columbia Banking System by 2.0% in the 3rd quarter. Vanguard Group Inc now owns 7,522,600 shares of the financial services provider’s stock valued at $291,650,000 after purchasing an additional 148,645 shares during the last quarter. Vanguard Group Inc. grew its stake in shares of Columbia Banking System by 2.0% in the 3rd quarter. Vanguard Group Inc. now owns 7,522,600 shares of the financial services provider’s stock valued at $291,650,000 after purchasing an additional 148,645 shares during the last quarter. Man Group plc grew its stake in shares of Columbia Banking System by 410.2% in the 3rd quarter. Man Group plc now owns 144,987 shares of the financial services provider’s stock valued at $5,621,000 after purchasing an additional 116,568 shares during the last quarter. Finally, Dimensional Fund Advisors LP grew its stake in shares of Columbia Banking System by 2.6% in the 3rd quarter. Dimensional Fund Advisors LP now owns 3,137,911 shares of the financial services provider’s stock valued at $121,655,000 after purchasing an additional 78,971 shares during the last quarter. Hedge funds and other institutional investors own 89.92% of the company’s stock.

Shares of COLB stock traded up $0.31 during midday trading on Friday, hitting $36.82. The company had a trading volume of 868 shares, compared to its average volume of 414,347. Columbia Banking System Inc has a 52-week low of $31.35 and a 52-week high of $45.22. The company has a market capitalization of $2.70 billion, a P/E ratio of 14.89, a price-to-earnings-growth ratio of 1.98 and a beta of 0.98. The company has a current ratio of 0.82, a quick ratio of 0.82 and a debt-to-equity ratio of 0.21.

Columbia Banking System (NASDAQ:COLB) last posted its quarterly earnings results on Thursday, January 24th. The financial services provider reported $0.62 earnings per share for the quarter, missing the Zacks’ consensus estimate of $0.68 by ($0.06). Columbia Banking System had a net margin of 29.54% and a return on equity of 9.01%. The business had revenue of $144.29 million during the quarter, compared to analysts’ expectations of $148.88 million. During the same quarter last year, the firm earned $0.54 earnings per share. The firm’s quarterly revenue was up 11.2% compared to the same quarter last year. As a group, equities analysts predict that Columbia Banking System Inc will post 2.66 earnings per share for the current fiscal year.

The firm also recently declared a quarterly dividend, which will be paid on Wednesday, February 20th. Investors of record on Wednesday, February 6th will be paid a $0.28 dividend. The ex-dividend date is Tuesday, February 5th. This is an increase from Columbia Banking System’s previous quarterly dividend of $0.26. This represents a $1.12 dividend on an annualized basis and a dividend yield of 3.04%. Columbia Banking System’s payout ratio is 45.34%.

In related news, EVP Andy Mcdonald sold 3,074 shares of Columbia Banking System stock in a transaction that occurred on Tuesday, November 20th. The stock was sold at an average price of $38.33, for a total value of $117,826.42. Following the sale, the executive vice president now directly owns 35,589 shares in the company, valued at $1,364,126.37. The transaction was disclosed in a document filed with the SEC, which can be accessed through this link. 1.06% of the stock is owned by insiders.

Several brokerages have weighed in on COLB. Zacks Investment Research upgraded Columbia Banking System from a “hold” rating to a “buy” rating and set a $41.00 target price on the stock in a research note on Monday, October 29th. ValuEngine upgraded Columbia Banking System from a “sell” rating to a “hold” rating in a research note on Friday, November 16th. BidaskClub upgraded Columbia Banking System from a “sell” rating to a “hold” rating in a research note on Tuesday, November 13th. Keefe, Bruyette & Woods upgraded Columbia Banking System from a “market perform” rating to an “outperform” rating and set a $45.00 target price on the stock in a research note on Thursday, November 8th. Finally, DA Davidson lifted their target price on Columbia Banking System from $43.00 to $45.00 and gave the company a “buy” rating in a research note on Friday, November 30th. Two research analysts have rated the stock with a sell rating, one has given a hold rating and four have assigned a buy rating to the stock. Columbia Banking System currently has an average rating of “Hold” and an average target price of $44.40.

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Columbia Banking System Profile

Columbia Banking System, Inc operates as the bank holding company for Columbia State Bank that provides a range of banking services to small and medium-sized businesses, professionals, and individuals in Washington, Oregon, and Idaho. It offers personal banking products and services, including noninterest and interest-bearing checking, saving, money market, and certificate of deposit accounts; home mortgages for purchases and refinances, home equity loans and lines of credit, and personal loans; debit and credit cards; and digital banking services.

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Institutional Ownership by Quarter for Columbia Banking System (NASDAQ:COLB)

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Vanguard Group Inc Raises Holdings in MSB Financial Corp. (MSBF)

Vanguard Group Inc raised its position in MSB Financial Corp. (NASDAQ:MSBF) by 1.1% in the third quarter, according to the company in its most …

MSB Financial logoVanguard Group Inc raised its position in MSB Financial Corp. (NASDAQ:MSBF) by 1.1% in the third quarter, according to the company in its most recent Form 13F filing with the Securities and Exchange Commission. The fund owned 140,999 shares of the savings and loans company’s stock after buying an additional 1,600 shares during the quarter. Vanguard Group Inc owned approximately 2.56% of MSB Financial worth $2,876,000 as of its most recent filing with the Securities and Exchange Commission.

Other hedge funds and other institutional investors have also recently modified their holdings of the company. Dimensional Fund Advisors LP lifted its stake in MSB Financial by 7.3% in the second quarter. Dimensional Fund Advisors LP now owns 35,183 shares of the savings and loans company’s stock valued at $756,000 after buying an additional 2,392 shares during the last quarter. Renaissance Technologies LLC raised its holdings in shares of MSB Financial by 6.3% during the third quarter. Renaissance Technologies LLC now owns 100,198 shares of the savings and loans company’s stock valued at $2,044,000 after purchasing an additional 5,898 shares during the period. Northern Trust Corp acquired a new position in shares of MSB Financial during the second quarter valued at about $204,000. Finally, Bank of New York Mellon Corp acquired a new position in shares of MSB Financial during the second quarter valued at about $227,000. Institutional investors own 20.94% of the company’s stock.

Shares of NASDAQ MSBF opened at $17.92 on Friday. The company has a current ratio of 1.19, a quick ratio of 1.19 and a debt-to-equity ratio of 1.14. The stock has a market cap of $98.74 million, a PE ratio of 20.00 and a beta of 0.22. MSB Financial Corp. has a 1-year low of $16.14 and a 1-year high of $21.95.

In other MSB Financial news, Director Gary T. Jolliffe sold 3,537 shares of the business’s stock in a transaction that occurred on Tuesday, December 4th. The stock was sold at an average price of $18.40, for a total value of $65,080.80. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this link. Also, Director Lawrence B. Seidman acquired 3,600 shares of MSB Financial stock in a transaction on Wednesday, December 12th. The stock was purchased at an average price of $17.40 per share, with a total value of $62,640.00. The disclosure for this purchase can be found here. Corporate insiders own 18.01% of the company’s stock.

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MSB Financial Company Profile

MSB Financial Corp. operates as the bank holding company for Millington Bank that provides various banking products and services in New Jersey. The company offers deposit products, including checking accounts; savings accounts, such as regular passbook, statement, money market, and club accounts, as well as six-level tiered savings accounts; certificates of deposit; and fixed or variable rate individual retirement accounts.

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Institutional Ownership by Quarter for MSB Financial (NASDAQ:MSBF)

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Alibaba joins $13m investment in IoT startup KONUX

These featured contributions are from Alibaba’s investment arm and businesses including New Enterprise Associates (NEA), Upbeat Ventures, and …

This new investment […] will give us even more financial exposure to further expand our product portfolio and accelerate our international market expansion, including our expansion into China. China is the largest and fastest-growing railway market in the world, and thus a key market for us…

– Andreas Kunze, co-founder and chief executive officer, KONUX

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With a Notable Double-Digit Increase, Zilliqa, Waves, and VeChain Attaining Power

Three coins which sit at the end of the popularity list namely Zilliqa, Waves and VeChain, are hoping for an impressive increase of double digits in the …

The crypto-world had witnessed a relatively huge drop in the market during late January, thanks to a considerable fall in Bitcoin’s price. The topmost digital currency BTC had disappointed crypto enthusiasts by not closing above the mark of $3,700. In fact, during the timeline of merely 60 minutes, the value of BTC/USD decreased to $3,590 from $3,730; leaving the lowest value mark in the month at $3,550.

According to the published reports, the total market cap globally had registered loss of a massive $4 billion during the market plunge. However, coin prices are trying to bounce back and retain their market positions with a hope to not sink to 100 billion dollars again which was recorded on December 15th.

But things are not that bad for all the coins. Three coins which sit at the end of the popularity list namely Zilliqa, Waves and VeChain, are hoping for an impressive increase of double digits in the past 24 hours. This possibility will hopefully lead the crypto world towards an improved market scenario.

VeChain or VET, a digital currency operating on the framework of Blockchain-as-a-Service (BaaS), has a primary aim of transforming and decentralizing how business management and supply networks are examined across the world. To accomplish this objective, the VET is working towards offering a platform that is transparent, quicker as well as trust-free.

VET not only tracks and verifies the supply network but also the quality and originality of the product to make sure that the end-consumers only receive the most authentic value for everything that they purchase. For this, VeChain uses the DLT or Distributed Ledger Technology efficiently. To make it simpler, VET closely gets itself associated with both the suppliers and manufacturers so that forged goods do not ever enter the market, harming the consumers.

In a more recent development, the renowned fashion giant H&M is said to be testing the VeChain solution for one of their clothing brands called Arket. The brand is attempting to incorporate the blockchain technology for precisely tracking their product offerings. Rumors about this piece of information had started doing the rounds before the brand making it official. Eventually, an official statement followed from the H&M subsidiary’s team, confirming the execution of blockchain which read,

“Arket has done a small Proof of Concept (POC) through a pilot testing with VeChain to use blockchain technology to secure product data traceability in the value chain,” adding, “The test was made on a wool beanie from the autumn 2018 collection.”

Similar to VeChain, the other two coins Zilliqa and Waves are heading towards regaining their losses made in the previous day swifter than expected.

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