“Bank Groups Urge Congress to Close ‘Loopholes’ in GENIUS Act”
The ABA, BPI, and numerous state banking groups are urging Congress to revise the GENIUS Act, warning that loopholes could allow stablecoin issuers to bypass the law’s ban on interest payments. They caution that this could trigger massive deposit outflows from banks, increasing liquidity risk and undermining credit creation. IntraFi’s latest bank executive survey queried bankers about whether they are concerned about the possibility of large corporations bypassing new prohibitions on interest-paying stablecoins and how the new legislation might impact their bank's overall strategy.
“Generative AI Can Produce Real-Time Deposit Pricing Strategies”
Generative artificial intelligence is accelerating the shift from intuitive deposit pricing to data-driven strategies. Learn how banks can grow margins using advanced analytics that enable lower funding costs, deposit stickiness, and faster decision making.
“New York Sues Zelle, Says Security Lapses Led to $1 Billion Consumer Fraud Losses”
New York Attorney General Letitia James claims that Zelle’s parent company, Early Warning Services, neglected to implement basic anti-fraud safeguards. A similar lawsuit was dismissed by the Consumer Financial Protection Bureau in March without explanation.
In other fraud-related news, read what banks are doing to warn customers of rising impersonation scams.
“CFPB Moves to Hold Synapse Accountable for Missing Customer Funds”
The CFPB plans to sue Synapse Financial Technologies for alleged “unfair acts or practices” related to the fintech’s failure to maintain accurate records of consumer funds and ensure its records aligned with its partner banks. With $60–90 million still missing, bankruptcy trustee and former FDIC Chair Jelena McWilliams has been providing data to the CFPB and supporting its investigation. The bureau is pursuing a settlement with nominal penalties and backs converting the case to Chapter 7 to speed compensation for affected consumers through its civil penalty fund.
“Banking’s Silent Goldmine: Loyal Customers Left Behind”
Banks tend to focus on big spenders and new accounts at the expense of loyal, steady customers who maintain steady balances and good financial habits. To reduce churn among “silent loyalists” and build lasting competitive advantages, they should instead reward behaviors such as consistency, relationship depth, and prudent financial management, this article says.
“CECL Update Eases the Math for M&A”
FASB plans to eliminate the “CECL double count” rule requiring banks to set aside extra capital for certain acquired loans, which could make bank M&A more attractive by reducing upfront capital outflows, shortening earn-back periods, and possibly improving pricing for sellers. The rule is expected to take effect in 2027, with banks having the option to adopt it early once it’s released.
“Warren, Democrats Ask Fed, FDIC, OCC to Justify eSLR Cuts”
Senate Banking Committee ranking member Elizabeth Warren, D-MA, and fellow committee Democrats urged banking regulators to extend the public comment period on a proposal to lower megabank capital requirements, citing insufficient justification and potential systemic risks.
In Other News
Adults are attending sleepaway camp to seek friendship, Silicon Valley is applying an innovation mindset to making babies, and President Trump took over the Washington D.C. police department.
Thanks for reading.