* The U.S. Small Business Administration has issued a procedural notice on procedures about ownership changes in an entity that received Paycheck Protection Program funds. It stated that the change will be without restrictions if, prior to closing the sale or transfer, the borrower has repaid the PPP note in full, or has completed the loan forgiveness process in accordance with the PPP requirements and the SBA has remitted funds to the lender in full satisfaction of the note or the borrower has repaid any remaining balance on the PPP loan.
* Regulators have warned banks against engaging in manipulative activities in the high-frequency financial market or face the risk of heavy fines and criminal convictions of traders, the Financial Times reported. U.S. authorities imposed a $920 million fine on JPMorgan Chase & Co. last week over manipulation of market demand in precious metals and U.S. government bonds via a practice called "spoofing." The fine reflected regulators' dissatisfaction with JPMorgan, sending a message that the violation is an equally serious liability to banks as rate-rigging, corruption or money laundering, the FT said.
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Banks facing what could be years of ultra-low interest rates and constrained revenues have been outlining aggressive cost-cutting plans, perhaps setting the stage for an industrywide break in a long trend of mounting payroll and other expenses.
BANKING
* Stimulus measures from the Federal Reserve and the U.S. Treasury may have benefited the economy, but they also helped swell the balance sheets of banks, which could force them to hold more capital, The Wall Street Journal reported.
* Fidelity Financial Corp. will acquire Yorktown Financial Holdings Inc. through its newly formed FFC Merger Sub Inc. subsidiary. The Kansas-based company's unit will act as a bank holding company for some time in the proposed acquisition, in which it will also indirectly acquire Yorktown Bank.
* New York-based Morgan Stanley has closed its all-stock acquisition of Arlington, Va.-based E*TRADE Financial Corp. E*TRADE common stockholders are entitled to receive 1.0432 Morgan Stanley common shares for each E*TRADE common share. E*TRADE CEO Michael Pizzi joined Morgan Stanley to lead E*TRADE's direct-to-consumer, digital self-directed business, while E*TRADE independent director Shelley Leibowitz joined the Morgan Stanley board upon closing.
FINANCIAL SERVICES
* Retail credit cards did not lower their annual interest rates — 29.99% — in 2020, even as U.S. Federal Reserve brought the interest rates close to zero, Bloomberg News reported, citing a report from creditcards.com. The average retail rate came down to 24.43% from 26.01% in the last year.
* Global Payments Inc. is considering the sale of its debit card business, Netspend Holdings Inc., and seeking a valuation of more than $2 billion for it, Reuters reported, citing sources.
POLICY AND REGULATION
* The U.S. Department of Treasury is working on simplifying the forgiveness process for Paycheck Protection Program loans of $50,000 or less, Secretary Steven Mnuchin said at a virtual conference. However, Mnuchin did not mention automatic loan forgiveness for smaller or larger loans.
MARKETS
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