FT News Briefing US banks move to reduce deposits, the Spac bubble deflates
May 4, 2021
US banks are urging corporations to pull back on deposits due to a cash surplus, highlighting a pivotal shift in banking dynamics. Meanwhile, Apollo has acquired Yahoo's media assets for $5 billion, aiming to revitalize its revenue. The podcast also delves into the faltering SPAC market, revealing a significant drop in institutional investment and increasing regulatory scrutiny as it struggles to regain its former allure. The discussion illustrates the complex landscape of finance and investment in today's market.
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Too Much Cash
- Excess cash at big U.S. banks like JP Morgan and Citibank is causing them to ask corporate clients to withdraw deposits.
- Low loan demand is making it unprofitable for banks to hold so much cash and affecting their regulatory ratios.
Apollo's Yahoo Gamble
- Apollo Management purchased Yahoo and other Verizon media assets for $5 billion, aiming to improve their profitability.
- Apollo believes they can increase revenue from Yahoo's large user base, particularly through gaming, gambling, and sports betting.
SPAC Slowdown
- The SPAC boom has cooled down due to market oversaturation and increased regulatory scrutiny.
- Regulatory concerns over SPACs' projections and financial reporting have caused investors to become wary.