Rob - we'll have to manage the repricing risk as it unfolds but here's hoping the Fed doesn't move rates down too fast.
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John Tyson
CFO;Chief Financial Officer - CFO
Altamaha Bank & Trust Company
Vidalia, GA
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Original Message:
Sent: 08-21-2024 13:45
From: Rob Blackwell
Subject: Community Banks to Feel 'Some Pain' in CRE; Capital Raises Drive Bank Deals
Unless the Fed lowers rates significantly in the coming months, banks' deposit costs are not likely to fall by much, S&P Global Market Intelligence wrote. NIMs should improve as fixed-rate assets reprice higher, though some CRE assets will struggle to find refinancing. Community banks will suffer loan losses as a result, though the problem won't be as bad as many fear, according to S&P. Check out the breakdowns of community banks' aggregate profitability metrics, deposit costs, CD balances, NIMs, and future credit costs.
Another S&P article discusses how capital raises are fueling bank M&A.
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Rob Blackwell
Chief Content Officer and Head of External Affairs
IntraFi
Arlington, VA
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Great question.
Just to clarify one thing for those who haven't been following it. For one, that article isn't recent. Periodically, and I'm never sure why, Google or another aggregator will resurface an old article as something new. That's what happened here, with Google regurgitating a Forbes story from last year that named IntraFi as a depositor at SVB. Which wasn't exactly right. As the article says, we never had our own money there. The amount they referenced was the funds of 2,000 different depositors, and all those balances were fully insured.
But the heart of your question is something different. What happens if a customer sees an article like that, gets the wrong idea, and goes to their bank and asks about their own IntraFi deposits? Generally, I don't see it as a worry. That's because the entire business of IntraFi is safety. As you said at the start, "I know our customer deposits are safe." So the response would be to convey that to the customer. Bankers have a lot of experience doing this already, and so do we. Our customer service team took a number of calls after SVB failed along these lines. And far from seeing deposits leaving because of any fears, the exact opposite happened. Customers were reassured that their deposits were protected, so they didn't run. If customers are coming to you worried about their deposits, IntraFi is an effective solution. As you all know better than me, insured deposits don't run. As for an AI, I have even fewer concerns because an AI would theoretically know those deposits are protected, so it couldn't be driven by an irrational fear that somehow they aren't.
Hopefully I'm making sense. Happy to discuss further.
Thanks,
Rob
Rob Blackwell
Chief Content Officer & Head of External Affairs
1300 North 17th Street, Suite 1800
Arlington, VA 22209-3810
(703) 292-3357
www.intrafi.com
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Original Message:
Sent: 11/8/2024 11:14:00 AM
From: Anonymous Member
Subject: RE: [Podcast] How Generative AI Agents Could Threaten Financial Stability
This message was posted by a user wishing to remain anonymous
Rob, very interesting topic. Since you brought up SVB in the pod as an example I was wondering if you had any reaction to the WSJ article that named the top depositor list recently. We saw Intrafi listed there and while I know our customer deposits are safe, is there anything in there we should dig into a little? I don't know what question to ask, but am thinking more along the lines of what if a customer asks us about Intrafi after seeing that in the article. Much like a AI model could read that and know someone has deposits somewhere and recommend they be moved. Thanks
-------------------------------------------Original Message:
Sent: 11-05-2024 15:38
From: Rob Blackwell
Subject: [Podcast] How Generative AI Agents Could Threaten Financial Stability
The rise of generative AI agents have promised consumers a better, safer future. But what happens if those agents act in ways that destabilize the system, causing bank runs or better enable bad actors to commit fraud or hack financial institutions? Todd Phillips, assistant professor at Georgia State University's Robinson College of Business, talks about his new paper looking into how AI could wreak havoc on the financial system.
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Rob Blackwell
Chief Content Officer and Head of External Affairs
IntraFi
Arlington, VA
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