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Your quick guide to the week ending April 14, 2023, on thebanker.com.
This week, we continue to examine the merger between Credit Suisse and UBS, take a bank view on embedded finance, and order a range of green bonds to start our sustainable transition plans. Meanwhile, opinions are shared on responsible artificial intelligence, consumer rights, market turmoil and offshore banking. We also track bankers on the move, reflect on the week with The Banker Midweek Podcast and sit down with payments expert Ruth Wandhöfer.
Trending topics
Post-mortem on the banking saga continues…
- Unravelling the Credit Suisse merger — Simon Fawell | Click here to read
Shareholders of both Credit Suisse and UBS have also expressed concern. They certainly did not waste the opportunity to show their displeasure at the bank’s annual general meeting on April 4, with one commenting: “I didn’t bring my gun along today, don’t worry. I am wearing my red tie to represent that I and many other shareholders are seeing red.”
Wait, so banks do understand embedded finance?
- Views on… embedded finance: “We’re relatively early for being an incumbent… which is exciting as much as scary” — Liz Lumley | Click here to read
“To provide banking-as-a-service (BaaS), banks are very well equipped,” Christoffer Malmer, head of SEB Embedded says. “That’s where we have our experience, knowledge and licence. We’ve been doing banking since 1856. We’ve been dealing with regulators all over the world. We’ve been working our way through understanding different changes in regulations and regulatory compliance, but also risk management and banking and financing and funding.
“A lot of other large banks are in a formidable position to leverage their strength, their balance sheet and capital liquidity licence experience to offer BaaS. So yes, I think banks are already well equipped, which I think we saw as a catalyst for this to happen.”
Have a cocktail… and a green bond
- From green bonds to corporate finance for sustainability — Fabrizio Palmucci | Click here to read
The EU green bond standard piece of legislation is laudable, but only one step of the journey. Market participants need to focus on the next, complementary part: transition plans and company-level financing. Green bonds are the ‘aperitivo’; it’s time for the main course.
Opinion sharers
Can robots be responsible for their actions?
- Banks need to do more to ensure responsible AI use — Joy Macknight | Click here to read
However, according to a recent report from independent intelligence platform Evident, banks across North America and Europe are failing to publicly report on their approaches to responsible artificial intelligence (AI) development. Evident’s research found that, currently, eight of the 23 largest banks in the US, Canada and Europe publicly provide no responsible AI principles.
The research found a lack of transparency around how AI is already used — and how it may be used in the future — which, it said, could damage stakeholder trust and stifle progress. The report also pointed to the lack of a standard for responsible AI reporting.
- New EU Directive could lead to a profusion of class actions — Susan Moore, Teresa Griffin and Sandra Grannum | Click here to read
The EU Collective Redress Directive represents part of a ‘new deal for consumers’, prepared partly in response to high-profile cases involving mass harm, or breaches of consumer rights in multiple EU states.
- Too early to declare victory on market turmoil — Innes McFee | Click here to read
For many, the March headlines of failing banks and squeezed liquidity brought back memories of late 2007 and the ensuing economic havoc. Although the comparisons with today are overdone, one salient point should be remembered: back then, it took a year before the full extent of the economic damage became clear.
- Offshore banking has had its day in the sun — Andrew Hunt and Ben Ashby | Click here to read
Two classes of investors are emerging: those who can legally remain offshore but legitimately move their capital to the bigger, mainstream financial centres such as London or New York, and those that can’t.
Globe at a glance
- EU banks well positioned to weather market volatility — Barbara Pianese | Click here to read
The median European bank could, in theory, lose 38% of its deposits before facing significant risk to capital due to losses on its held-to-maturity securities or the sale of other illiquid assets, says financial services firm Jefferies.
Bankers on the move
- The Banker Board – April 13, 2023 — Simon Duffy | Click here to read
People moves from British Arab Commercial Bank, ING, Goldman Sachs and Houlihan Lokey.
Watch and listen…
- The Banker Midweek Podcast | April 12, 2023
Where’s Patsy Kensit in bed with a Union Jack when you need her? Britcoin foreva!
- Redecentralisation and a new digital social contract
Ruth Wandhöfer, author of ‘Redecentralisation — Building the Digital Financial Ecosystem’, talks about how the evolving digitisation of financial services is impacting the end user.
