Banks should be more open to embracing digital currencies — that's the view of the chairman of Swiss bank UBS. Axel Weber believes that banks risk being left behind unless they respond with more authority to the emerging trend of cryptocurrencies. "Whilst the official sector very often looks at the risks of these new means of payment, the private sector tends to look at the opportunities they offer", Mr Weber told the Financial Times. On the whole, digital currencies remain a fringe activity for the majority of global banks: one clear exception is Japan's J-Coin, fruit of a consortium spearheaded by Japan Post Bank and Mizuho Financial Group. As well as Japan, the Philippines and Switzerland have set out regulations for cryptocurrencies. But it may be that they become a matter for central banks more than private enterprise: China, the Netherlands and Sweden, to name but a few, are pondering the future of fiat and may well produce a digital currency alongside physical cash.
In the US, regulatory burdens could ease on financial firms as a deal was struck during the week between the Senate Banking Committee and a group of moderate Democrats. If passed into law, the reform package would pave the way for small and regional lenders to gain relief through the loosening of post-crisis regulations as well as reducing compliance for the likes of community banks. "The bipartisan proposals on which we have agreed will significantly improve our financial regulatory framework and foster economic growth by right-sizing regulation, particularly for smaller financial institutions and community banks", committee chairman Mike Crapo said. Most significant of all would be a threshold rise from $50bn in assets to $250bn for too-big-to-fail banks.
Citigroup has led a $20 million investment round in Artificial Intelligence company, Behavox. The three-year-old AI firm, which is based in London and valued at some $200 million, produces technology that monitors staff performance and is set to be rolled out by the bank to monitor all sorts of aspects of a banker's job, such as telephone calls and emails. "The way you engage people is directly relevant to your performance. We can help firms to work out what drives more revenue", Erkin Adylov, co-founder of the company, said. Behavox's software employs natural language processing, is capable of analysing sentiment and can attempt to classify emotional states, based on signs of raised voices or laughter.
Readers may remember that EFTPOS, Australia's payments system, was made available through Apple Pay last month for ANZ Bank customers. Now the system has become available to eight credit unions as well. These developments mean that more Australians will be able to avoid Visa or Mastercard fees by paying directly from their savings and current accounts.
Lafferty Bank Quality Benchmarking
Of the banks mentioned above, UBS was assigned a three-star rating in Lafferty's 2017 Quality Benchmarking report, while Mizuho, Citi and ANZ were each given two stars: the maximum possible is five stars.
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