Thursday, October 19, 2023
Several regional banks reported sizable drops in profit during the third quarter as they struggled with higher deposit costs and rising loan losses, a reminder that the stresses that roiled the industry in the spring are not entirely over.
The stock of Zions (ZION) plunged by nearly 10% Thursday after the bank reported that earnings fell 19% when compared to the same year-ago period. The stock of Discover Financial (DFS) fell by nearly 8% after it posted a 33% drop in profits. Truist (TFC) fell by more than 2% after disclosing that its profits had declined by 28%.
Regional banks are generally on more stable ground than they were during the first half of the year, when the failures of Silicon Valley Bank, Signature Bank and First Republic in March and May triggered panic about the strength of many other mid-sized banks across the US.
But profitability remains a challenge as high interest rates posed by the Federal Reserve mean deposits are more expensive, paper losses on bonds held for investment go higher, and it becomes more difficult for bank borrowers to pay back their loans.
New capital requirements proposed by US regulators threaten to make it even more difficult for some of these mid-sized banks to earn robust profits in the future.
Regional bank stocks have notably lagged the S&P 500 this year, even as they've recovered from their lows reached back in May. As of Thursday's close, the S&P Regional Bank Index ETF (KRE) was down 31% year to date. The S&P 500, in contrast, has gained 12% this year.
"Things have certainly settled down" in the regional banking world since the spring, Fed Chair Jerome Powell said Thursday after a speech in New York, but added later that "I do think their business model is under pressure."
A big concern for many regional banks is a key measure of profitability known as net interest income, which measures the difference between what banks earn on their loans and pay for deposits.
Higher interest on deposits is squeezing that income for some, including Zions. The Salt Lake City-based institution said the interest Zions paid depositors rose by 95%, to $366 million, and it expects those costs to continue to "increase marginally" even if interest rates don’t go higher.
"The opportunity for improvement will be really largely predicated on our ability to actively manage those deposit rates," CFO Paul Burdiss said.
At Truist, a regional bank based in Charlotte, net interest income also fell 4.3% when compared to the year-earlier period. It paid depositors $1.5 billion in the third quarter, 5.5 times more than it had to pay them in the year-ago period.
"The cost of funding is not free," CEO Bill Rogers told analysts.
Truist Financial Corporation Chairman and CEO William Rogers Jr., testifies before a House Committee on Financial Services Committee hearing on
Truist CEO William Rogers Jr., in 2022 on Capitol Hill. (AP Photo/Andrew Harnik) (ASSOCIATED PRESS)
Its write-downs and provisions for bad loans also roughly doubled for the same period to $902 million, signs that borrowers are having more problems with their existing debts and that the bank expects loan losses to go up in the future.
The same challenges pulled down results at credit-card bank Discover Financial. Net write-offs and provisions for credit losses both jumped.
Discover CFO John Greene said the bank is seeing “mildly increased stress” among customers with low-to-mid credit scores as credit card delinquencies rise.
Rising concerns about credit were also an issue for Synovus (SNV), where profits dropped 53% from a year ago.
The Columbus, Ga.-based institution set aside $73 million in provisions for bad loans, nearly three times as large as they were a year ago, while it wrote-off $62 million for loans that went bad during the quarter.
Its stock fell more than 2% Thursday.
"Although credit is moderating, we believe that it's still very manageable. It's within the ranges that we had anticipated," Synovus CEO Kevin Blair said.
David Hollerith is a senior reporter for Yahoo Finance covering banking and crypto. Jennifer Schonberger contributed to this article.
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Republican Party is fascist ;,Republicans threaten other Republicans: “Rep. Mariannette Miller-Meeks, R-Iowa, said in a statement she has received "credible death threats and a barrage of threatening calls" after voting against Jordan Wednesday.
Rep. Don Bacon, R-Neb., said he and his family have received threats.
"My wife has been getting anonymous texts and phone calls to compel her to get me to change my vote, which is wrong ... trying to bully my wife is wrong," he said.
In text messages Bacon provided to ABC News, one person messaged his wife saying "Your husband will not hold any political office ever again. What a disappoint (sic) and failure he is."
PHOTO: Rep. Don Bacon (R-NE) cast his vote as the House of Representatives holds its second round of voting for a new Speaker of the House at the U.S. Capitol on Oct. 18, 2023 in Washington, DC. (Anna Moneymaker/Getty Images)
Rep. Mariannette Miller-Meeks, R-Iowa, said in a statement she has received "credible death threats and a barrage of threatening calls" after voting against Jordan Wednesday.
"One thing I cannot stomach or support, is a bully," Miller-Meeks said.
Rep. Carlos Gimenez, R-Fla., told ABC News that his office and staff have received calls to try to pressure him to back Jordan.
"[Jordan] told me he wasn't behind it and he has asked people to stop. If you have asked people to stop it, why haven't they listened to you?" Gimenez said.
"I don't really take well to threats. In fact, if you threaten me, I will probably go the other way," Gimenez added.
Rep. Drew Ferguson, R-Ga., voted against Jordan for speaker in the second ballot, and said he and his family have received death threats.
"When the pressure campaigns and attacks on fellow members ramped up, it became clear to me that the House Republican Conference does not need a bully as the Speaker," he said in a statement.
PHOTO: Rep. Drew Ferguson (R-GA) arrives for a House Republican members meeting as the conference continues to debate the race for Speaker of the House at the U.S. Capitol Oct. 19, 2023 in Washington, DC. (Win Mcnamee/Getty Images)
Ferguson switched his vote to Scalise from Jordan on the second ballot.
MORE: Why Republican Jim Jordan's House speaker bid is being blocked by moderates in his party
"Shortly after casting that vote, my family and I started receiving death-threats. That is simply unacceptable, unforgivable, and will never be tolerated," he said.
Jordan told ABC Senior Congressional Correspondent Rachel Scott that the death threats were "terrible."
"There's no place for that for anyone. It's just wrong," Jordan said.
Some conservative media voices have pushed listeners and viewers to call members who don't back Jordan.
MORE: Jordan defiant after repeated GOP rejections in House speaker voting
Former Trump White House adviser turned podcast host Steve Bannon earlier this week urged his followers to pressure GOP members to fall in line and back Jordan.
"Call them and get in their grill. Let them know what you think … Email, call their local office, all of it, burn it down. That's right. Get up in their face," Bannon said on Wednesday morning's show.
Capitol Police, the agency charged with protecting members of Congress, would not comment on how it is handling the threats.
"For safety reasons, the USCP does not discuss potential security measures for Members or any potential investigations,” Capitol Police said Thursday.
Rep. Steve Womack, R-Ark., voted against Jordan for the gavel and suggested to ABC's Scott that even more Republicans oppose Jordan but are "holding their noses because they fear the backlash."
"They all have their reasons. And I have mine," Womack said. "I hope people will at least give us the courtesy of respecting our position. Disagree with us, be mad with us, vote against us. Do what you've got to do. But understand, we all took an oath to the Constitution, we're trying to do our very best."
-ABC News' Will Steakin and Sarah Beth Hensley contributed to this report.
Republicans who voted against Jordan for speaker say they've been threatened, harassed originally appeared on abcnews.go.com
Wednesday, October 18, 2023
Caucus, Auto Workers Would Not Be on Strike
September 26, 2023 / Jane Slaughter enlarge or shrink text login or register to comment
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Workers in red shirts picket outside. Many of the picket signs are white with UAW logo, Local 412, and the words "Stellantis Bargaining in Bad Faith."
UAW members are on strike today, with inspiring levels of rank-and-file energy, in part because four years ago a small group of activists founded a new reform caucus. Photo: Jim West, jimwestphoto.com
What can workers seeking to reinvigorate their unions learn from the new spirit in the United Auto Workers?
START WITH WHAT YOU'VE GOT
One lesson is that member power does not have to start from a supermajority; that’s unlikely. UAW members are on strike today, with inspiring levels of rank-and-file energy, because four years ago a small group of activists founded a new reform caucus. That caucus, Unite All Workers for Democracy (UAWD), boldly took advantage of an unexpected opportunity, organized like crazy, and won elections. Its candidates are now leading the union.
If UAWD had not existed and organized hard, this current fight that has potential to change the stakes for the entire labor movement would not be happening. At the top, the UAW would still be a pretty bad business union, intent on negotiating a cheap contract (perhaps with a b.s. strike), and members would be in the dark.
When the Justice Department began investigating the UAW for corruption, a few longtime activists saw the opening. In 2019, they founded UAWD and began a campaign—which seemed quixotic at the time—to change the UAW’s constitution so that members could vote directly for top officers.
Since the union’s founding in the 1930s, convention delegates had chosen the officers. From the 1940s until this year conventions were tightly managed by the aptly named Administration Caucus, founded by Walter Reuther. The process for amending the constitution is byzantine, but in a short time UAWD was approaching its goal of getting the required 15 locals representing 79,000 members on board to call a special convention. Then Covid hit, canceling local union meetings and closing plants.
UAWD rebounded, though, and was soon making its views known to the Justice Department: the way to clear out corruption was to let the members vote. This was the same tack taken by Teamsters for a Democratic Union in the 1980s, when their union was under investigation. TDU rejected the idea of a federal takeover, as many in government had advocated, and said instead: “Let the members decide.” The feds authorized a rank-and-file vote, Ron Carey was elected president with TDU’s support, and he went on to lead a stunningly popular and successful strike in 1997.
Eventually the Justice Department’s Monitor said he would let UAW members decide whether they wanted to decide. In fall 2021, they voted whether to keep the old convention system or switch to one-member-one-vote. Turnout was light—only 14 percent of the 400,000 members and 600,000 retirees, indicating both the high degree of member cynicism and the sorry state of the union’s address book—but the direct elections option won by 63.6 percent.
The Administration Caucus, who at that point still ran the union, tried to pretend the vote was not happening, but UAWD campaigned hard, with members building contact lists, distributing leaflets, phonebanking, talking with co-workers and the media, getting pledges signed, doing social media, and holding online events. They got UAWD members elected as convention delegates and managed to turn the 2022 convention from a ceremonial snoozefest and rubber stamp to a site for debate. The convention raised strike pay and had it start on a strike’s first day instead of its eighth—ensuring that the union’s $800 million strike fund could be used to make the decision to strike less painful for members.
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UAWD, which by this time included both factory workers and members from the union’s newer higher ed locals, then nominated seven people for a slate called UAW Members United to run for the 14-member executive board. Again members campaigned hard, taking road trips around the Midwest and holding Zoom events in addition to all their other tactics. The Administration Caucus, accustomed to total control for nearly 80 years, still did not take the UAWD threat seriously. When members voted in fall 2022, again with a very low turnout, five Members United candidates and one friendly independent were elected outright and the other two, including presidential candidate Shawn Fain, went to a runoff.
At this point, the AC woke up and threw everything it had into holding on to the presidency. But Fain was finally elected by a slim margin in March 2023 and sworn in just hours before the union’s scheduled bargaining convention.
HAVE FAITH IN THE MEMBERS
UAWD did not represent a supermajority of the members and only a bare majority of those who voted. Yet Fain and his allies on the board and in the rank and file believed they could win over and activate members who had been uninvolved, skeptical, or even despairing about their union.
So despite the deep muck at union headquarters and the fact that local officers were almost uniformly allied with the Administration Caucus, they set to work building a contract campaign—strike pledge cards, practice picketing, lots of communication, lots of media—that built to the strike that started two weeks ago. Despite their slim majority, they took their mandate seriously and pushed hard to do what they had promised. They went directly to rank-and-file members.
The results have been stunning. Members at the Big 3, whether they voted for UAWD or for no one, are thrilled that their president is actually sharing the union’s demands, speaking to them regularly via Facebook Live (and responding in real time to comments in the chat), and calling out the CEOs who make up to $14,000 an hour, with class-struggle language seldom heard outside a Bernie Sanders rally. The excitement on the picket lines and the creativity of the slogans and tactics members are inventing are something not seen in the union in many decades. Members have rediscovered respect for their union and for themselves as auto workers and union members.
SEIZE THE MOMENT
That brings up a second lesson, which is for workers to grab their chance even if they’re not completely ready. In a perfect world, UAWD would have grown through the years to represent a majority of well-organized members, proving itself through practice at the local level. Instead, a random corruption investigation, initiated during the Trump years, changed everything.
Lesson three, then, could be that it’s worthwhile to keep the spark of reform alive even when it’s tiny. Some of the UAWD founders were part of Autoworker Caravan, a group founded in 2008 to respond to the Chrysler bankruptcy. Caravan was never large—at some points attracting more retirees than active members—but it analyzed contracts, agitated to vote them down, and distributed information. Some of its leaders had been part of socialist groups in the 1970s. And the Caravan in turn incorporated veterans of the New Directions Movement of the 1980s, which had galvanized factory workers (especially in Missouri, Kansas, Oklahoma, and Texas) but was eventually beaten down by the Administration Caucus. Some UAWD leaders today go back as far as New Directions. The politics of union reform were kept alive even when hopes were bleak.
Now UAWD is helping workers develop into organizers. It’s shown them how to call 10-minute meetings in their plants and how to organize practice pickets, flying squadrons, and overtime refusals. Leaders are well aware that despite the tremendous victory of winning at the top, their work to transform the union is just beginning.
Jane Slaughter is a former editor of Labor Notes and co-author of Secrets of a Successful Organizer.
, members of the Union for Southern Service Workers (USSW) gathered in a downtown Atlanta parking lot on a brisk early fall morning. As union members rubbed their hands together and joked about being underdressed, many held protest signs, megaphones, or carts carrying water bottles. Their mission? Waffle House worker Gerald Green speaks to the rally. | Erica Meade / People’s World To march on a Georgia State University (GSU) Waffle House location and raise the demand for a guaranteed $25/hour pay rate for all workers. They aren’t alone in their struggle.
ATLANTA—On Thursday, Sept. 21, 2023, members of the Union for Southern Service Workers (USSW) gathered in a downtown Atlanta parking lot on a brisk early fall morning. As union members rubbed their hands together and joked about being underdressed, many held protest signs, megaphones, or carts carrying water bottles.
Their mission?
Waffle House worker Gerald Green speaks to the rally. | Erica Meade / People’s World
To march on a Georgia State University (GSU) Waffle House location and raise the demand for a guaranteed $25/hour pay rate for all workers. They aren’t alone in their struggle. Across the South, in cities such as Durham, N.C., and Orangeburg, S.C., USSW members and allies would soon be marching on other Waffle House locations to raise the same demands. The Atlanta USSW rally was just the kick-off for a day of regional action.
On Sept. 9, USSW members and GSU Waffle House workers delivered a letter to the location management calling for better pay and workplace safety. Their request fell on deaf ears, however, and union members knew it was time for action.
As GSU students held out their phones to film the action, the USSW marched towards the Waffle House in a tight formation to the tune of various union songs and chants. Upon arriving at the location, supporters cheered on the marchers as they packed inside the restaurant waving a banner reading: “Our Dedication Deserves Dignity, PAY US $25!”
Supporters gathered around USSW member Mo Haskins as he read a list of demands: a guaranteed wage of $25/hour for all employees, 24-hour security at all Waffle House locations, and an end to the meal deductions that are taken off each employee’s paycheck, regardless of whether they eat shift meals or not.
The rally finished off with several USSW members, including GSU Waffle House workers, delivering remarks to the crowd and their co-workers about why they deserve higher wages and safer working conditions.
Speakers also addressed the fact that Waffle House executives sit on the board of the Atlanta Police Foundation, and are using company profits to fund a militarized police training facility known as “Cop City.” If Cop City is built, close to 300 acres of forest will be torn down in metro Atlanta to build a $90 million dollar police training complex where police would practice raids on fake schools, homes, and barber shops.
As the speakers wrapped up, the crowd erupted into more union tunes, each of which called for the pay raises and other demands. As the USSW members filed outside, members spoke to the crowd about the unsafe working conditions and unfair wage practices Waffle House employees endure.
One worker reported that Waffle House failed to cover replacement costs when a customer stole her phone; other employees reported having to deal with customer assaults with little accountability or protection by Waffle House.
Red, a GSU Waffle House server, talks about the forced meal deductions that Waffle House makes from every worker’s paycheck. | Erica Meade / People’s World
Red, a GSU Waffle House server, expounded on the meal deductions and low wages that come with every paycheck. Red said Waffle House “nickel and dimes us for everything, but they don’t want to give the nickels and dimes back.” According to her, “Even if you eat or not” while working, “they’re gonna charge you ten dollars” per paycheck.
That, however, wasn’t the only way employees noted about how Waffle House unfairly reduces their wages. For Red’s usual 9 p.m. to 7 a.m. shift, the doors are locked and all orders must be placed through a carry-out window. With every carry-out order, the restaurant charges a ten percent “to-go” fee, however, workers don’t see the extra profits for this extra service reflected on their paychecks.
According to Red, while a “to-go” fee is included on the wage statement, “If you go down to the deductions section, they take it right back.”
As USSW members moved away from the GSU location, one member read from her phone that members in South Carolina had begun their rally and would be making noise for the same demands the union had just raised in Atlanta.
USSW is asking supporters and allies to sign a petition backing the demands on their website to show Waffle House executives that the general public is on the workers’ side. All Waffle House employees and all service workers are encouraged to reach out to the union and become involved with the fight for fair wages and safe workplaces.
TAGS:
Atlanta
fast food workers
Georgia
Labor
CONTRIBUTOR
Erica Meade Erica Meade
Erica Meade is an organizer with the Angelo Herndon Club in Atlanta, Georgia. She got her start in political organizing through mutual aid in D.C., her hometown, before becoming involved with the Claudia Jones School for Political Education.
















