Correspondent Blog

Go to any Trader Joe’s market and then go to a competing market, and you will be likely to find a significant difference. Trader Joe’s has produced a COVID-19 response that is thoughtful, practical, relatively inexpensive, and caring. From their increased staffing to their small gestures like a preferred senior’s line, the handing out of…

More Fiscal Bills to Come? Now that the U.S. has surpassed China in the number of reported COVID-19 cases, and the trajectory still scarily upwards, calm talk from the administration won’t be sufficient to keep markets from starting to price in more dire scenarios for both the death toll and the economic hit. That is…

When the Chairman of the Federal Reserve takes it upon himself to appear on the ever-popular Today Show, you know you’re living through unique times, but that’s where we find ourselves. The money quote from Powell was “not to worry about the Fed running out of money.” That tells you they will be all-in and…

While the Fed jumped into the unfolding crisis with both feet, investors have been nervously awaiting the details of a fiscal stimulus package out of Congress, and we finally got one yesterday evening. With the $2 trillion package agreed to but still awaiting formal passage, the risk-on mood was strong with stocks anticipating the deal…

Last week we took a look at why and how bankers must triage their credit portfolio first before taking action. We also looked at some initial restructuring steps banks can take in a related article. In today’s article, we model a $1B commercial loan portfolio and look at what could happen to probabilities of defaults,…

The impact of coronavirus on community banks will be widespread, and, with some borrowers, the restructuring efforts may take a long time and will sap substantial bank resources. Even as bankers are exerting time and effort to help some borrowers stay in business and continue to service their bank debt, other borrowers are looking for…

Since their emergency rate cut last Sunday the Fed has been hyperactive in instituting new programs in order to provide liquidity and apply some cushion to the economic fall.  The Fed quickly grasped the gravity of the situation and the coming dive in economic output with an array of programs that we thought/hoped we wouldn’t…

How To Create A High Performing Bank With An Employee Handbook Let’s be honest. Your bank employee handbook is probably a snooze-fest. If you are like most banks, your employee handbook was likely cobbled together from a template given to you by a third-party human resources firm or a revision of another bank’s handbook. Chances…

As the virus spreads its way across the U.S., the question turns to how long will this last? You’ve no doubt seen the charts that compare case numbers by country and across time. Looking at the results from China they started reporting cases in early January and are now taking tentative steps to return to…

The economic implications of coronavirus are expected to be widespread and are already causing some borrowers to be concerned about their ability to make loan payments. Many of our bank customers have used the ARC program to fix rates for borrowers while retaining a variable rate. Some of these borrowers in profoundly affected sectors, such…

The Fed did more than cut rates on Sunday; they pumped a massive amount of liquidity in the system, sending a signal to banks to level up. Far behind the health of employees and customers in the COVID-19 pandemic, comes the economic impact. Unlike the recession of 2008, where the economic impact came over many…

The Fed met in emergency session yesterday and cut rates 100bp (0.0%-0.25%) and also reinstated quantitative easing. The move on a Sunday afternoon underscores the seriousness of the developing coronavirus and the Fed dug deep into its tool kit. In addition to cutting rates to zero they also announced they will purchase $500 billion in…