Breaking Banks

Alexandra Steinberg Barrage, a former FDIC executive and banking regulatory expert, joins industry veterans Kiah Haslett, Alex Johnson, and Jason Mikula to dissect the FDIC's proposed changes to broker deposit regulations, dating back to 1989. They discuss the need for modernization in regulations to match technological advancements and shifting consumer behaviors. The group also dives into empowering individuals as deposit brokers and the evolving landscape of customer acquisition in finance, while making it all fun with playful hot sauce commentary.

Dive into the dynamic world of fintech as experts discuss how embedded finance and open banking are reshaping consumer experiences. Discover how Mastercard's Start Path program empowers startups to innovate and expand access to financial services. Hear about Atomic Financial's groundbreaking solutions that allow seamless direct deposit management. Explore the collaborative spirit driving personalized banking and the challenges fintech faces, especially in emerging markets like Latin America. It's a bold new era for finance!

Gilles Gade, founder and CEO of Cross River Bank, joins Phil Go, CEO of the American Fintech Council, to dive into resilience in banking post-regulatory challenges. They discuss how consent orders can be transformed from setbacks into opportunities for growth. The conversation highlights the evolution of banking technology, emphasizing the need for proactive risk management rather than avoidance. The guests advocate for collaboration between banks and fintechs to navigate regulatory pressures while boosting financial inclusion and consumer-centric approaches.

The podcast dives into the exciting ascent of fintech companies like Revolut, which has recently secured a UK banking license, setting the stage for its U.S. expansion. With 45 million customers and a revenue over $2 billion, Revolut is challenging traditional banking norms. Additionally, the discussion highlights TymeBank's innovative approach in South Africa, promoting financial inclusion with a seamless onboarding process through digital kiosks. The hosts emphasize how technology is reshaping banking, pushing for broader access and redefining customer experiences.

In This Episode Another thrilling episode of Breaking Banks' special series Killing It!. Host Jason Henrichs connects with fintech superstar, dare we say fintech Olympian (Paris 2024!), Bill Harris, industry veteran, founder of 10+ tech and fintech companies, author, and current Founder & CEO of Evergreen Money. Together Jason and Bill look back at Bill's career to date, the different companies, the lessons learned and the tough calls made. Among those hard decisions, the need, at times, to avoid prolonging a failing venture and the need to conserve resources. It's a race to the finish where Bill shares details about his latest endeavor. https://youtu.be/zh-rAm6t_DY

The conversation dives deep into the integration challenges facing the fintech landscape, highlighting the costs and complexities involved. With a staggering $80 trillion processed through the ACH system, partnerships emerge as a vital solution. The guests discuss innovative payment interfaces and the evolution of real-time payment systems in the U.S. They also tackle the crowded fintech event scene, exploring best practices for maximizing the value of networking and content. The necessity for genuine connections in this dynamic industry is emphasized, blending humor and professionalism.

In This Episode Deposits are the aqua vitae of banking, the water of life. The very core of the traditional banking business model is gathering deposits at no to low-cost and lending the money back out at higher rates. Bankers used to reference the “3-6-3 Rule”: bring in deposits at 3%, make loans at 6%, and be out on the golf course by 3:00PM. Money is the primary raw material in the business of banking. The difference between what financial institutions pay for that raw material is subtracted from what they earn from lending it out right at the very top of their income statements. That difference is net interest income, and it is the largest component of earnings for virtually every bank. As much as 95% or more for some. Expressed as a ratio, the net interest margin or NIM is a key metric in measuring bank performance, and it’s been under considerable pressure lately. The traditional levers have been trying to lower deposit rates and raise loan rates, and hope you don’t lose too much volume. As the business has become more complex, so have the tools and strategies to reduce that pressure. Today we get into some of the hidden levers that banks are using to add non-rate value, one focus is SBA lending. How new approaches and new technology is expanding the market for banks large and small, and also for fintechs; and how the secondary market is helping to improve liquidity and improve NIM. Joining host JP Nicols in this episode are Steve Tanzer and Joel Updegraff, both Managing Directors at Brean Capital. Read the entire transcript here. Podcast Content: Chapter 1: 00:00 - Introduction: The Lifeblood of Banking The hosts introduce net interest margin (NIM) as a critical metric for bank performance and set the stage for a discussion on strategies to manage NIM pressures. Chapter 2: 05:20 - SBA Lending: A Hidden Lever for Profitability Steve Tanzer from Breen Capital explains the role of Small Business Administration (SBA) loans in enhancing bank liquidity, profitability, and risk management. Chapter 3: 15:45 - Expanding Beyond Local Markets The discussion shifts to how banks can diversify geographically and leverage national lending platforms while maintaining strong customer relationships. Chapter 4: 25:30 - The SBA Secondary Market: Transforming Loan Portfolios An overview of how the SBA’s secondary market enables banks to sell guaranteed portions of loans, generating fee income and freeing up capital for growth. Chapter 5: 35:10 - Fintech Partnerships and Efficiency Gains The panel explores how fintech and "Fintech Lite" solutions are streamlining SBA lending, boosting efficiency, and expanding credit access to underserved markets. Chapter 6: 45:25 - Innovations Born from the Pandemic Insights on how SBA modernized processes during COVID-19, including the shift from wet signatures to digital transactions, improving efficiency in loan settlement. Chapter 7: 55:15 - Lessons from Leaders: Specialization and Technology The hosts highlight examples like Live Oak Bank, showcasing how specialization in industry verticals and investment in technology yield competitive advantages. Chapter 8: 1:05:30 - Getting Started with SBA Lending Practical advice for banks new to SBA lending, including understanding the program’s economics, finding the right partners, and identifying growth opportunities. Chapter 9: 1:15:40 - Non-Traditional Players in the SBA Space The role of non-bank lenders and fintech innovations in reshaping the SBA landscape is examined, emphasizing their influence on efficiency and market dynamics. Chapter 10: 1:25:10 - Closing Thoughts: The Future of NIM and SBA Lending The episode wraps up with reflections on the evolving role of SBA programs and non-rate strategies in addressing NIM compression challenges. Related Content: Episode 340: Good Policy, Good Banking Episode 560: Killing It: Ohad Samet on Reimagining Debt Collecti...

In This Episode This Breaking Banks episode's Killing It guest went from software engineer to investment banker to founder of a community supporting the next generation of fintech founders to adviser then founder of the fintech team at Andreessen Horowitz (A16Z) and now solo venture fund founder in the fintech space investing at the angel, pre-seed and seed stage. Meet Rex Salisbury, founder Cambrian Ventures, backing early-stage companies, as he shares his journey and founder stories -- his path, motivation and the support that ultimately led him to being a solo fund founder after clearly being bitten by the fintech bug. He shares thoughts on putting talents and strengths to good use, creative destruction and how to think about failure to get you where you want and ought to be. In short, he's killing it! https://youtu.be/v8MC6xGc_lo

In This Episode Soft landings are a topic of hot conversation these days. The go-go days where you can always raise another round are gone. The ecosystem is littered with companies with little product market fit, less revenue and even less runway. Many of these are looking for a soft spot to land. Unfortunately M&A is hard in the best of times and many fintechs are now looking to banks as a potential exit. In the first half of today's show, Jason Zaler, partner at Oliver Wyman, joins Jason Henrichs to discuss Oliver Wyman's  new report on bank fintech M&A. In the second half,  Robert Antoniades, General Partner at Information Venture Partners, and Jason H talk about 3 decades of venture cycles and M&A more broadly including strategies for big banks, community banks, fintechs and even VCs. Read the entire transcript here. Podcast Content: Chapter 1: 00:00:00 - Insights into Bank and Fintech Partnerships Introductory thoughts on fintech struggles and the shifting landscape of bank-fintech partnerships. Chapter 2: 00:12:45 - Bank-Fintech M&A Challenges and Opportunities Exploring the difficulties banks face in acquiring fintechs and factors impacting M&A deals. Chapter 3: 00:24:10 - Case Study: SoFi's Acquisition Strategy A deep dive into SoFi's significant acquisitions, including Galileo and Technisys. Chapter 4: 00:37:00 - Key Steps to Successful Integration Post-Acquisition Outlining the playbook for integrating fintech acquisitions successfully. Chapter 5: 00:45:15 - Navigating Regulatory Hurdles in M&A Challenges fintechs and banks face in complying with emerging regulations. Chapter 6: 01:00:30 - Venture Capital Trends and Market Outlook Discussion on venture capital cycles, overfunded startups, and future fintech consolidation. Chapter 7: 01:15:00 - Closing Thoughts on Fintech Consolidation Predictions on soft landings, hard landings, and where fintechs are headed next. Related Content: Bank-Fintech Partnerships, Open Banking and AI...oh my! Episode 31: Where Does the Money Go? - Corporate Venture Capital - The Challenges of Strategic Investing Episode 553: The Secret of NIM Episode 558: Fintech Visionaries Reimagining the Future of Finance: Start Path Episode 561: Demystifying Fintech: Insights on Banking's Future https://youtu.be/1e5Vtj3fiEQ

Regulatory lawyer Jesse, Trustly's Matt, and editor Kiah discuss the aftermath of Synapse's bankruptcy, focusing on banks' compliance failures and AML/BSA issues. They delve into regulatory gaps, risk management, and the need for banks to adapt to digital risks. Insightful discussion on evolving banking landscape and industry challenges.