Correspondent Blog

Bank payments are a mess. Every payment method is a different channel. Worse yet, we confuse our customers with different forms, procedures, and jargon. It has been 50 years and we still expect our customers to know the difference between a wire and an ACH. If we can’t talk to customers about it right, we…

Fed Setting the Stage for Big Core PCE Number There has been a lot of Fed Speak this week and it mostly has been focused on the reoccurring theme that near-term inflation indications are transitory and not of long-lived concerns. We think part of the jawboning this week is pointing towards the Friday release of…

Both the Federal National Mortgage Association (Fannie) and the Federal Home Loan Mortgage Corporation (Freddie) have aggressive multifamily lending programs and comprise the bulk of the market. Freddie’s total multifamily finance activity in Q1/21 was $14B, and Fannie Mae’s was $21.5B.  Some bankers complain that taxpayers’ dollars are creating an unfair playing field for financing…

The Market Gets Another Inflation Number This Week After the FOMC minutes last week put a bit of a scare into markets with taper talk mentioned, cooler heads prevailed and Treasuries managed to recoup trading losses from that day and moved further lower in yield as the week concluded and investors became more assured that…

Treasuries Bounce Back After Taper Talk Comment Treasuries have recouped all the selling that came about off the April FOMC minutes from Wednesday afternoon when the mention that tapering might be discussed at an upcoming meeting. That timeframe upset market sensibilities that thought it more a late summer discussion point. Once the realization hit that…

If you are looking to make best-in-class decisions, it pays to have a variety of best-in-class tools at your disposal. Oftentimes, a reason why banks don’t innovate more is that they lack the tools and experience to properly understand the risk and the return. Without a way to quantify the risk, stagnation occurs. As banks…

Treasuries Happy in the Range A slow week of economic data is allowing Treasuries to drift around within the 1.60% – 1.70% range for the 10yr and that is likely to continue for a time. Next week brings personal income and spending numbers for April and the expectation is that they will look a lot…

Our previous publications discussed current banking industry dynamics for loan pricing, how community banks are responding, and some winning strategies for community bankers.  We contend that excess liquidity and tepid loan demand are the main culprits in driving community bank net interest margin (NIM) to the lowest level in recent history.  With loan-to-deposit ratios dropping…

Fed Speakers Get Another Chance to Talk Transitory Inflation After a week of consequential economic data, this week is a bit thin in that respect but we do get some Fed input that will be closely followed by investors.  The minutes from the April 28 FOMC meeting will be released on Wednesday, and while the…

Treasuries Still Standing After CPI and New Supply The Treasury market rather easily absorbed hotter-than-expected CPI and PPI reports, not to mention new 3yr, 10yr, and 30yr supply. So that begs the question, if a red-hot CPI and fresh supply can’t move yields over recent highs what will it take? Maybe today’s retail sales report,…

April CPI to Add to Inflation Story Later this morning we get April CPI and the equity market hasn’t waited around to sell on the rumors. Expectations are that overall CPI will reach a ten-year high of 3.6% while core CPI is expected to spike to 2.3% versus 1.6% in March. This is the base…

If you are a traditional company in America, you produce a product, get some beta customers and then write a press release to announce the product or service to the world. You create the narrative in your press release to fit reality. However logical this seems, it might be the wrong way to do it….