Wednesday, May 16, 2012

Wells Fargo wants $203 million overdraft judgement reversed

Welcome to the morning roundup. Here's a look at what's news in banking and finance.

Overdraft suit. Wells Fargo has asked a federal appeals court to nullify an order to pay $203 million to California customers after a lawsuit alleging the bank manipulated how charges were processed to boost overdraft fees, according to Bloomberg. A district court judge ruled in 2010 that the bank's practices were "unfair, deceptive and fraudulent."

More JPM. Copious ink continues to be spilled on JPMorgan Chase, which held its shareholder meeting Tuesday in Tampa. The Wall Street Journal parses out whether its risky trades were hedges or bets. A Washington Post columnist ponders what the right lesson from the bank's $2 billion trading loss should be. Businessweek says it's a reflection that Corporate America hasn't changed since the financial crisis. The Daily Beast says the fact that Dimon gets to keep both his CEO and chairman's roles and pay package is a reflection of an "unshakable hubris." A number of hedge funds run by former JPMorgan employees are profiting from the bank's bad trade, Fortune writes. And a Motley Fool writer collects the "10 smartest things" said about the debacle.

Foreclosure to homeownership. A "small but growing number" of people who lost their homes to foreclosure are making a quick return to homeownership, Reuters reports. Many of the new loans are backed by the federal government.

Naked shorting. Employees at both Merrill Lynch and Goldman Sachs traded emails discussing naked short selling in violation of compliance rules between 2005 and 2007, according to an Inc. court filing, Bloomberg reports. The retailer is accusing the two banks of manipulating its stock.

Euro zone improvement? Greek's economy might have grown for the first time since 2009 in the first quarter, the New York Times reports. The Euro zone has also avoided falling into recession. But it's too early to call it a turning point, the Times writes.  

Stocks. U.S. markets were set to open higher this morning on better news from Europe, Reuters reports. But traders expect more volatility ahead.