Banks should avoid large acquisitions “until the dust settles” from deals done during the financial crisis, U.S. Bancorp Chief Executive Officer Richard Davis said, citing costs that can come years later.
U.S. Bancorp, the largest bank based in the Midwestern U.S., is the leading contender to buy the Chicago branches of Citizens Financial Group Inc. because smaller bidders are wary of raising capital to fund the deal, people with knowledge of the matter said.
OneWest Bank FSB, the lender formerly known as IndyMac Bancorp Inc., plans to pay a $1 billion dividend to backers including George Soros and John Paulson ahead of an initial public offering next year, two people with knowledge of the matter said.
JPMorgan Chase & Co., enmeshed in legal battles with regulators, U.S. agencies and clients, agreed with 21 institutional investors to pay $4.5 billion to resolve claims the bank sold faulty mortgage securities.
Lenders including JPMorgan Chase & Co. and Citigroup Inc. will have to show they can survive the demise of a trading partner or a plunge in value of high-risk business loans in the 2014 version of U.S. stress tests.
The Federal Reserve said it will examine how the biggest banks might react to a jump in long-term interest rates and another housing crash as it released the next round of stress-test scenarios designed to monitor the ability of the U.S. financial system to withstand economic shocks.