Street Talk

A few years ago, blockchain technology caught fire across the Street, with some market participants arguing that it would displace many traditional financial services. Those lofty expectations have come back to earth, but practical applications are beginning to surface, including from the nation's largest banks. In the episode, Tom Mason, fintech analyst at S&P Global Market Intelligence, discusses whether blockchain is a disruptor of traditional financial services or another arrow in the quiver for incumbent players.

As the equity research business continues to face revenue headwinds, more firms could look to merge with pure play advisory shops. In the episode, George Kuznetsov, head of research and analytics at Coalition, which is owned by CRISIL under the S&P Global umbrella, discussed changes in i-banking league tables as well as the evolution of the equity research business and how it is only profitable for a few but essentially necessary for the vast majority of firms.

Fintech companies and digital-only players have become a threat to traditional banks' retail deposit bases and they could soon turn their focus toward commercial customers. In the episode, experts from Promontory Interfinancial Network and Sandler O'Neill and executives from Goldman Sachs, Heritage Bank and Republic Bank discuss the growth of digital-only deposit platforms, how they have changed the competitive landscape and what community banks can do to combat the threat.

Investment banking firm Hovde recently unveiled a new practice that will work with community and regional banks on asset/liability strategies and ways to utilize technology, including through fintech partnerships, to improve efficiency. Ray Chandonnet, a banking industry veteran and head of the new group, discussed his return to investment banking, different funding strategies banks can employ to win business in a competitive environment and how institutions can work with and emulate fintech startups to attract new customers and become more efficient.

Some fintech companies are making hay with digital platforms that tout their differences with banks, even though they are often offering virtually the same products. In the episode, we discuss with colleagues Rachel Stone and Kiah Haslett the deposit strategies employed by the likes of Chime, Aspiration and other incumbent players such as Ally Financial, Discover and Capital One. Those efforts conjure up memories of a Don Draper pitch in Mad Men and likely will enjoy continued success.

The days of large bank buyers pursuing deals to plant a flag in a new market might be gone with acquirers now seeing deals as a way to support investments in technology. BB&T touted that prospect when discussing its landmark merger of equals with SunTrust. In the episode, we spoke with S&P Global Market Intelligence colleagues Zach Fox and Joe Mantone about the drivers of BB&T/SunTrust merger, how much i-banks advising on the deal stand to earn and the prospect of other similarly sized transactions emerging in the future.

The PG&E Corp. bankruptcy shows that financial backers of California utilities need to consider the risks associated with climate change but that exposure might be unique to entities operating in the state. In the episode, Regulatory Research Associates analysts Dan Lowrey and Dennis Sperduto discuss the next steps in PG&E's bankruptcy process, the future of its power purchase agreements and the risks that climate change can bring to backing utilities.

The competition for deposits is quite fierce and banks might even feel the greatest pressure when vying for large commercial customers. In the episode, Kelly Brown, CEO of American Deposit Management, a financial services firm that helps connect depositors with banks, talks about the competitive landscape and pricing in the market, while offering strategies to win new business. https://americandeposits.com

Bank stocks just recorded their worst annual performance in seven years. Some analysts believe the selloff has left bank stocks undervalued, while others see few tailwinds to drive the group higher. In the episode, we highlight outlooks from Keefe Bruyette & Woods and Hovde Group analysts and make the case that investors looking for a port in the storm would be wise to back strong deposit franchises.

The recent selloff has put some banks on sale at a time when their deposits are only becoming worth more, according to Chris Marinac, co-founder and director of research at FIG Partners. The veteran analyst believes bank stocks have fallen too much over the last two months and he sees value in strong deposit franchises, some of which could receive healthy takeout offers at some point down the road.