In today’s top news in digital-first banking, banks have tightened their loan standards per a survey from the Federal Reserve, while a watchdog organization warned banks about the risk of outsourcing key technology. Plus, Mizuho Financial Group is the latest bank to try to cash in via the sale of data on client spending and other financial habits.
The Federal Reserve’s October 2020 Senior Loan Officer Opinion Survey on Bank Lending Practices found that banks made their loan standards to companies of any size stricter and that they also experienced demand that was softer than normal. Banks also indicated that under 5 percent of loans were in forbearance in Q3.
A global watchdog organization is warning banks about the risk of outsourcing essential technology. The Financial Stability Board (FSB) cautioned especially “about the possibility of systemic risk arising from concentration in the provision of some outsourced” services to financial institutions (FIs). The group indicated that the risks may become increased as the count of financial institutions receiving essential services from a third party rises.
Mizuho Financial Group is the newest major bank to try to cash in through the sale of information on client spending and other financial habits. The information would be reportedly aggregated and not have personal information attached as a way of safeguarding client privacy. Mizuho joins an increasing number of financial giants that are aiming to take a page from Big Tech firms by monetizing their collections of customer information.
The combination of a Joe Biden victory and the prospects of a coronavirus vaccine points to a rallying worldwide economy, according to a report that cited Goldman Sachs forecasts. Goldman Sachs indicates that it foresees a “V-shaped” recovery that could be larger than first expected now that a vaccine seems near. Pfizer and BioNTech announced promising news of a vaccine on Monday (Nov. 9) that is said to be over 90 percent effective in preventing COVID-19.