Mr. Duncan MacDonald

GLG News by Mr. Duncan MacDonald, Consultant

GLG News is now G+ Insights

G+ is a community for professionals, academics and entrepreneurs to connect through online discussions and in-person meetings. You will continue to see G+ Insights (formerly GLG News) here as well as on the G+ website, where you can share and discuss the G+ Insights you read.

Premature to celebrate Court's curb on class actions?

June 21, 2011

Analysis of:Justices Curb Class Actions | online.wsj.com

Yesterday the Supreme Court significantly made it much harder for lawyers to bring class actions on behalf of workers but also consumers, investors, merchants, taxpayers and others. In the process it will make life much easier for businesses and our state and federal court systems. A cause for celebration, indeed.

High Court's class action decision dents retail effort against interchange fees

June 20, 2011

Analysis of:Wal-Mart Wins Supreme Court Sex-Bias Case Ruling | online.wsj.com

The Supreme Court today significantly made it harder for consumer and commercial plaintiffs to sue corporations via class actions. Ruling in favor of Walmart in an anti-discrimination suit, the Court said plaintiffs must present substantial evidence that the various class members share a precise standard of commonality of facts and law to achieve a class certification consistent with the Constitution's due process protections of defendants. As such it is a big victory for businesses.

Durbin's debit fee Amendment survives in Congress but may not in court

June 14, 2011

Analysis of:Banking Industry Girds for Debit-Card War in Court | online.wsj.com

The rejection of a delay in the implementation of the Durbin Amendment rule to cap debit card swipe fees at 12 cents has emboldened the payments industry to litigate the legality of Durbin and the FRB rule proposed last December. The plaintiffs will argue that the FRB's interpretation of Durbin was way off the mark per the constitutional standards that apply to federal agencies under the Administrative Procedures Act.

Durbin's demise signals interchange's resurrection

May 4, 2011

Analysis of:How Interchange Debate Could Be Affected by Tester s Reelection Race - American Banker Article | www.americanbanker.com

The Banker's article all but predicts a legislative burial of the Durbin interchange amendment of the Dodd-Frank bank reform law. The final Senate vote could well exceed the number that enacted Durbin last year, perhaps garnering 65-70 votes. If so, it will be a slaughter against interchange fee regulation, with broad and long term ramifications for the card networks and their issuers.

Debit card fee battle lynchpin to interchange pricing regime

March 8, 2011

Analysis of:Debit Card Fees Bring Lobbyists to Capitol Hill - NYTimes.com | www.nytimes.com

The NYT article updates the effort in Congress to delay, dilute or nix the Durbin law that strictly limits debit card interchange fees. Media coverage two months ago ridiculed the effort. Now it is on the brink of success, improbably with the help of Barney Frank. The article ignores the obvious math in the Senate that favors card issuers: powerful, key Democrats and most Republicans against Durbin. The House is even more against Durbin.

Catch-22 on debit card interchange fee issue

January 4, 2011

Analysis of:At Banks, New Fees Replacing Old Levies | online.wsj.com

The article describes what bankcard issuers are thinking of imposing to offset the possible revenue losses from the proposed FRB regs to drastically limit debit interchange fees. Experts have claimed that debit fees could be reduced anywhere from 70-90% under the FRB regs, which implement the Durbin amendment to the Dodd-Frank bank reform legislation of 2010.

Will the FRB sink AmExp on debit interchange?

December 20, 2010

Analysis of:AmEx Slide Weighs on Dow | online.wsj.com

The WSJ article notes that AmExp pulled the market down (12/20/10) because of investor fears that the company is "more exposed" to lose debit card interchange fees than its competitors because of the recent FRB proposed regs implementing the Durbin amendment. The feds regs could slash the fees by up to 90%. Analysts had expected a less draconian position, despite the language in Durbin that is unquestionably hostile to the bankcard industry. AmExp's debit fees rank among the highest.

Debit card fee lose first round

December 16, 2010

Analysis of:Visa, MasterCard Plunge as Fed Issues Rules to Cut Debit Fees | www.bloomberg.com

According to Bloomberg, the FRB has issued a proposed regulation that will reduce debit card interchange fees by as much as 75-90%. As an FRB Governor said at its hearing this afternoon, the fed is only doing what Congress ordered in the Durbin Amendment of the new Dodd-Frank bank reform law. The effect will be vastly reduced issuer revenues, award programs and perhaps debit transactions. The FRB will now ponder industry comments and finalize a rule by mid-April.

Abusive practices risk under Dodd-Frank: Multiple targets

November 23, 2010

Analysis of:New Abusive Standard in Dodd-Frank Has Bankers Nervous - American Banker Article | www.americanbanker.com

Per the American Banker article, banks are worried that the new consumer protection bureau (CFPB) will nix credit products for being "abusive" to consumers. They fear the Bureau will go too far in its interpretation -- that it will be the abuser. Unrecognized is a 3rd potential abuser in the shadows: the new Congress. It is under a voter mandate to cut government regs and costs. Which of the three will inflict abuse in 2011?

Elections doom interchange, card industry challenges

November 4, 2010

Analysis of:Dodd-Frank Act May Be Scaled Back by New Congress - NYTimes.com | www.nytimes.com

The NY Times' election coverage notes how a Republican dominated House will try to scale back the Dodd-Frank bank reform law re bankcard interchange pricing and the new consumer protection bureau. It correctly notes how difficult this will be, but fails to acknowledge the possible consequences of the effort itself (i.e., regardless if it passes or fails) on the broader bankcard debate. Viewed from that perspective, Tuesday's results could prove to be a disaster for adversaries of the industry.

Court threat to Dodd-Frank on interchange caps

October 13, 2010

Analysis of:TCF Calls for Reinforcements in Long-Shot Battle vs. Dodd-Frank - American Banker Article | www.americanbanker.com

The article spells out why TCF Financial's suit against the FRB over debit interchange fee regulations is a "long shot." TCF says the Durbin amendment to the Dodd-Frank bank reform legislation unconstitutionally forces the FRB to lower the fees under cost and discriminatorily, because they will not cover all bankcard issuers. The former would constitute a taking of TCF's property without due process or just constitution in violation of the 5th amendment and the latter the equal protection clause. The article says there are many laws that have drawn distinctions like Durbin that have been upheld in court.

Constitutional challenge to Durbin debit card regulation

October 12, 2010

Analysis of:Federal Reserve Sued by Minnesota Bank on Debit Caps | www.bloomberg.com

TFC Financial, a MN bank, has sued to stop the FRB from issuing debit card interchange pricing regulations pursuant to the new bank reform legislation -- the so-called Durbin amendment. TCF claims Durbin is unconstitutional.

American Express not a pushover for DoJ

October 6, 2010

Analysis of:American Express Sinks Again on U.S. Antitrust Case | www.bloomberg.com

American Express has decided to fight the DoJ's effort to force it to allow merchants to steer its cardholders into paying with less expensive payment vehicles. The impression by this and other media reports is that Amex is vulnerable to a defeat and thus sizeable revenue losses, as well as exposure to market share reductions by its competitors.

Another win for merchants against card networks

October 5, 2010

Analysis of:U.S. Proposes Settlement With MasterCard and Visa - NYTimes.com | www.nytimes.com

As announced in the NYT, the Justice Dept. has forced Visa & MasterCard to allow merchants to steer cardholders to the cheapest alternative over interchange expensive cards: lower rated debit cards, lower rated credit card types (e.g., those without reward features), prepaid cards, cash discounts, etc. Because American Express would not similarly settle, the DoJ sued it to achieve the same result, perhaps more.

Ominous study by Boston FRB on credit card interchange pricing

July 29, 2010

Analysis of:FRBB Public Policy Discussion Papers | Who Gains and Who Loses from Credit Card Payments? Theory and Calibrations | www.bos.frb.org

The study by the Federal Reserve Bank of Boston is a threat to the bankcard industry. Although it focuses only on credit card interchange, which it criticizes quite strongly, it could influence how the FRB in D.C. will regulate debit interchange per the Durbin amendment in the new bank reform law. To my knowledge, it is the first time the fed has ever condemned interchange pricing. The study says credit interchange results in a significant monetary transfer from cash customers to cardholders.

Smoot Hawley Redux: The new Consumer Financial Protection Agency

June 28, 2010

Analysis of:Lenders prepare for wide changes under Consumer Financial Protection Agency | www.ft.com

The key quote in the article, from a bank trade association executive, says the CFPA is "the single most damaging provision in the legislation" to reform the retail banking system. In fact, the new agency's powers are as extensive as any given to any agency in US history. They literally give the CFPA a life and death power over every product and process in the retail banking system. The only questions that remain are who will head it, how broadly will it be enforced and what will it cost?

By how much will bank reform reduce debit interchange fees?

June 28, 2010

Analysis of:Interchange Measures May Cost Banks More than $5B - American Banker Article | www.americanbanker.com

The Banker estimates that the FRB could interpret the reform law to justify debit interchange fee reductions in the 50% range (or more) from current levels or about $5B per year. Is the Banker's guess on target? Will the FRB squeeze a key revenue scheme that could hurt dampen spending and consequently harm card issuers and cardholders?

Bankcard pollution spreads across retail system

June 17, 2010

Analysis of:End Is Seen to Free Checking | online.wsj.com

The article covers the natural consequences of the bankcard meltdown that produced last year's draconian CARD Act and this year's threat to debit interchange fees. Essentially, both require that fees for a late payment and merchant debit interchange be reasonable and proportionate to the card issuer's fixed operational costs. By reducing revenues, they force issuers to reduce other costs and find new fees. Hence the article's emphasis on new deposit account fees and forced account closings.

Is Congress going to dilute the Durbin interchange amendment?

June 11, 2010

Analysis of:Senate Holds Reg Reform Conference s Upper Hand - American Banker Article | www.americanbanker.com

A small part of the article focuses on the controversial bankcard interchange provisions in the bank reform bill now before a joint House-Senate reconciliation committee. Interestingly, it has quotes from the committee leaders that hint there will be adjustments. Rep. Frank states that "some of the provisions" of the amendment will survive and Senator Dodd says "modifications will be coming." But how so: simply by writing the provision more clearly, or toughening or diluting them?

Will bank reform conference committee dilute Senate bill?

May 26, 2010

Analysis of:Democrats Reg-Reform Conference Choices Bode Ill for Banks - American Banker Article | www.americanbanker.com

The article reports that the conferrees chosen so far to sit on the joint Senate/House committee to finalize bank reform legislation is weighted toward the left -- toward opponents of bank interests, in effect, toward a tougher anti-bank result.

Page : 1234Next1 to 20 of 66