A Canadian man pleaded guilty last week to a scheme to break into the cloud storage accounts of at least 165 companies, steal their data and extort them for it.
Santander lost employee payroll data in the campaign, and credit unions that had no direct relationship with the storage provider are still paying the cost of cleanup after the intrusion allegedly exposed their members’ card numbers.
The case serves as a reminder of the cybersecurity risks of fourth parties (tech vendors with which a financial institution has no direct relationship) and the importance of enforcing multifactor authentication.More here.
Fed analysis shows return to stock-bond correlation of 1990s
The driving force behind the U.S. economy has shifted in recent years, according to recent analysis by the Federal Reserve Bank of San Francisco, and the results could have significant implications for the business cycle, monetary policy and portfolio construction.
In an economic letter published this week, Thomas Mertens, associate director of research in San Francisco Fed’s economic research department, and Wesley Wasserburger, a research associate at the reserve bank, make the case that economic activity and risk are both being driven by supply-side factors.
As evidence of this shift, Mertens and Wasserburger highlight the changing correlation between stock prices and bond yields.More here.
New auto-loan volumes rise as credit standards weaken
New auto-loan volumes hit a record high in the second quarter as lenders relaxed their underwriting standards,and the percentage of borrowers falling behind on their payments continued to rise.
Auto-loan originations climbed to $211 billion, according to data released Tuesday by the Federal Reserve Bank of New York, which called it the highest quarterly volume on record. Outstanding auto-loan balances saw “solid growth” in the quarter, the New York Fed said, reaching $1.71 trillion, up $28 billion from the prior quarter and up $58 billion year over year.
The rising car-loan originations came as credit standards slipped. The median credit score on newly originated auto loans fell seven points from the first quarter, according to the report.More here.
Planned FDIC standards for tech vendors may help small banks
Federal regulators are considering options for helping banks vet their technology providers.
The Federal Deposit Insurance Corp. is in preliminary discussions with multiple banking and fintech trade associations to establish an independent standard-setting body, referred to as a “Banking Innovation Standards Development Organization,” that would help certify whether bank tech vendors meet federal regulatory guidelines. The news was first
A senior FDIC official confirmed with American Banker that discussions are ongoing and verified the origins of a draft term sheet circulated among trade organizations involved in the discussions.More here.
Humid July CPI report puts pressure on Fed to hike
Pressure could be mounting on the Federal Reserve to raise interest rates after inflation regained steam in July.
After a slight reprieve in June, progress on inflation appears to have stalled in July, according to the Bureau of Labor Statistics’ latest consumer price index report. It shows prices ticked up by 10 basis points in July for a headline inflation rate of 3.4% year over year. Core inflation, which factors out food and energy, rose 2.6%.
Both the headline and core rates were in line with economic forecasts ahead of the report. They also matched the prints from June. Because inflation did not improve, the outcome bolstered arguments that inflation is persistent, broad-based and in need of containment.More here.
