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Home » Retail Banking 2020 Insights » Morning Briefing: 14 August

Morning Briefing: 14 August

With low gasoline prices bringing down the costs of running a car, US consumers are borrowing for new and second-hand cars, driving total lending past $1 trillion in loans outstanding for the first time, with $119 billion in car loans originated in the second quarter of 2015 alone. The Wall Street Journal reports that "Auto and housing loans have one thing in common: delinquency rates near the lowest levels in years."

Goldman Sachs appears set to move into retail banking with the acquisition of $16 billion in customer deposits from GE Capital, says the New York Times. Traditionally an investment bank, Goldman Sachs converted to a bank holding company in the aftermath of the financial crisis, and gave indications it would be moving into online lending when it announced the hiring of Discover's Harit Talwar in May. The acquisition of the GE Capital deposits will give Goldman access to capital it can then loan through its new operation.

The Canada Mortgage and Housing Corp says that real estate markets in Toronto, Regina and Winnipeg are now "high risk" according to the Financial Post. One economist warned that the Canadian government risked throwing fuel on the fire as Prime Minister Stephen Harper promised a re-elected government would make it easier for people to get into the housing market.

Bank of America, Barclays, BNP Paribas, Citi, Goldman Sachs, HSBC, JPMorgan, RBS and UBS have agreed to pay a total of $2 billion to investors, according to legal firm Hausfeld, which acted on behalf of investors in the case. Hausfeld chairman Michael Hausfeld told AFP that "While the recoveries here are tremendous, they are just the beginning." He said that investors around the world should take note of the recoveries secured in the US.

Standard Bank announced that its H1 profits rose by more than 25 percent, driven by lending to business. According to Reuters, corporate lending is growing in South Africa's as banks pull back from the personal lending market.


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