Top BaaS Banker, Tim Heilman at Choice Bank

Coming off The FedFis Roundup and watching the FTX meltdown, KNOWING that fintech is not going away. Maybe today is when YOU should join the Bankers Helping Bankers BaaS Association. Learn, collaborate, and enjoy your own BaaS Channel. Check out the new Resources section. The BaaS Association is the largest organization of BaaS Bankers promoting and educating other bankers. Want to find a fintech?

Uncle Sean Update - Happy Friday!!!

Wishing everyone a very Happy Thanksgiving coming up next week!!!! Here is the Uncle Sean Update for 11/18/22:

• The FTX bankruptcy continues to reverberate throughout the broader industry and dominate the headlines all week…  
• FTX had no Board of Directors and no CFO…. Per this CNBC article, the new CEO, John Ray III, said “Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here.” Keep in mind that this is the same guy that oversaw the liquidation of Enron… ENRON!!! Uncle Sean can’t help but wonder what kind of due diligence those commercial investors and VC firms were actually doing to pump up a $33+ Billion valuation…. Meanwhile:
• Genesis received a $140M capital infusion from their parent company after disclosing a $175M exposure to FTX.
• Just a few days after the $140M capital injection, Genesis announced they are halting all withdrawals and new loans…
• Visa terminates FTX global debit card agreement including FTX U.S. Debit Card as "We have terminated our global agreements with FTX and their U.S. debit card program is being wound down by their issuer."
• Last week we mentioned that BlockFi has paused withdrawals citing “lack of clarity” around the FTX meltdown. Now it appears that Curve is in active discussions to acquire BlockFi's CC customers. Additionally, it is being reported by the Wall Street Journal that BlockFi is preparing for potential bankruptcy filing.
• Voyager Digital is restarting their takeover auction process – and Binance is relaunching their bankruptcy auction bid to acquire Voyager that they previously lost out on to FTX (shocking, right??? – sarcasm)….
• And of course this little jewel emerged – you simply MUST read the tweet exchanges in this article – holy cow!!! Sam Bankman-Fried (ousted FTX CEO and under current investigation by the SEC and DOJ) engaged in a surprising late-night Twitter dialogue with Vox reporter, Kelsey Piper…
• All I can say is, Bro – don’t drink and Tweet!!!! LOL 😲

• The U.S. Department of the Treasury released their 128 page report titled “Assessing Impacts of New Entrant Non-bank Firms on Competition in Consumer Finance Markets” – Reuters has a good summary. In short the Treasury report states:
• When done responsibly, fintech growth has spurred competition and innovation; and has delivered benefits to consumers – particularly in the unbanked / under-banked demographics.
• However, the fintech industry is also creating new risks to consumer protection and market integrity.
• As such, the U.S. Department of the Treasury recommends that fintech-bank partnerships be subject to enhanced regulatory supervision AND additional oversight by the CFPB and FTC.

• Certainly worth paying attention to as Pay-By-Bank is a hot new topic – J.P. Morgan Payments and Mastercard are piloting a Pay-By-Bank solution with a small number of U.S. billers and merchants this year and “expect to expand in 2023.”

• First National Bank of Buhl (FDIC ) has rebranded to B2 Bank. Uncle Sean has been waiting for this next announcement for a while now - B2 Bank is also the new Sponsor Bank behind the upcoming M1 high-yield savings account with 4.5% APY available to M1 Plus members.
• Recall where Mr. Brian Barnes announced about a year ago - So…I bought a bank, so B2 Bank becoming a sponsor bank for M1 was just a matter of time. Very cool stuff!!!!

• Square announced they are partnering with American Express to offer a Credit Card for Square Sellers further empowering SMB’s on the Square ecosystem.

• Credit Union regulators were busy this week closing a couple of very small WV CUs. Both CUs were previously conserved on 10/7/22 and quickly liquidated after determining they were “insolvent and had no prospect for restoring viable operations.”
• The NCUA liquidated Mingo County Education Federal Credit Union (Charter 22678; $2.7M Total Assets)
• The NCUA also liquidated O.F. Toalston Federal Credit Union (Charter 6239; $478K Total Assets)

• Unit (fintech middleware BaaS platform / connector) expands into charge card issuing.

• Nirvana Money announced on their website (nirvana.money) that they are shutting down effective Dec 1 without formally launching beyond beta.

• Promontory MortgagePath announces closure due to “unprecedented and rapid mortgage market deterioration.”

• Collective Liquidity (wealth-tech platform for shareholders of unicorn valuation companies) launched their innovative liquidity and risk management platform to allow shareholders access to liquidity with WebBank as the lender of Exchange Loans offered through the platform.

• And another big bank takes a page out of the fintech playbook… This time it is Wells Fargo announcing Flex Loan, a digital-only small-dollar-loan ($250-$500) for a flat fee to eligible customers via the mobile app with funding provided in mere minutes.

• Notable FinTech funding for the week:
• PayZen (healthcare patient financing) raised $20M in Series B plus a $200M credit facility.
• Fennel (self-directed ESG-focused mobile investing app) raised $5M in Seed funding.
• ZSuite Tech (digital commercial escrow products for FI’s) picks up $11M in Series A funding round. Check out their ZEscrow and ZRent solutions for banks at zsuitetech.com.
• Daylight (LGBTQ+ digital fintech banking platform) raised $15M in Series A round and will launch Daylight Grow, a subscription based financial and family planning solution designed specifically for LGBTQ+ families.

Random Uncle Sean Stuff:

• Artemis I finally launched this week! The unmanned rocket will circle the moon and come back to Earth in 25 days, hoping to pave the way for new manned missions to the moon in 2025.
• I posted this recipe last year, but it certainly bears repeating…  If you get tired of the traditional Turkey and leftovers, do yourself (and your family) a favor and try this super easy Chili Con Queso recipe (it’s my daughter Claire’s favorite and Aunt Patty gives it two thumbs up as well). It is AMAZING on top of tamales (which is a staple in Texas over the Holidays), hot dogs, hamburgers, and of course with tortilla chips!!!! It makes quite a bit, but I’ve never had to throw any of it away – LOL!
• 32 oz Velveeta (cut into smaller pieces to help with melting), 15 oz can of chili (no beans), 1 lb cooked & drained ground beef, 8 oz can of tomato sauce, 2 cups of Half and Half, 4 TBL Chili Powder, 2 TBL Smoked Paprika, 2 TBL Cumin, 1 tsp Cayenne, and juice from 3 limes. Drop everything into your slow cooker and place on high for 2 hours while occasionally stirring. 
• Here are a few Dad jokes to get you into Thanksgiving week:
• I bought some skinny jeans…. Don’t waste your money - they don’t work. 😊
• Weird though of the week - Someone literally made up how a dinosaur sounds without ever hearing one, and we all have accepted it as absolute fact! LOL
• And some sage advice from Uncle Sean just in time for the Holidays – an apple a day can keep anyone away if you throw it hard enough!!!! 😝

Have a GREAT weekend & a wonderful upcoming THANKSGIVING Holiday - and please stay safe!!!

Uncle Sean

Sometimes known as Sean Mayo – contact me directly for scope and pricing of custom reports / analysis projects at smayo@fedfis.com | 214-604-6961 – or you can contact FedFis Sales Team at 512-960-0911 | info@fedfis.com #FedFisHasTheData FedFis

FedFis, LLC disclaimer – The views and opinions of Uncle Sean are of his own and may not necessarily represent the views, endorsements, and/or opinions of FedFis, LLC – we all know he’s a little bit different; but that’s why we love him.