FA Insights is a daily newsletter from Business Insider that delivers the top news and commentary for financial advisors.
Student loans are taking longer to repay (Bloomberg)
AAA-rated student loans are in danger of being downgraded. Bloomberg reports people who took out their loans before the financial crisis are taking longer than expected to repay them, and that’s at least partially due to relief programs created by the government. Rating agencies Moody’s and Standard and Poors said the ratings on the bonds could be cut to junk, which Bloomberg says could “unleash an unusual situation where fundamentally sound bonds with minuscule coupons that reflect their low default risk would need to find new buyers, potentially crushing their prices.”
The ECB turned on the spigots to Greek banks (Business Insider)
On Wednesday, Greece’s parliament voted to accept the bailout conditions laid out by its creditors. On Thursday, the European Central Bank announced it would increase emergency liquidity assistance to Greek banks. At Thursday’s press conference, Draghi said the ELA was increased by 900 million euros after the Greek banking system saw an outflow of 8.18 billion euros in June.
2015 is the year of the mega deal (Wealth Management)
The M&A market has been gangbusters in 2015. DeVoe & Company’s managing partner, David DeVoe, told Wealth Management there have been eight “megadeals” so far in 2015, which has it on track to be the best year for megadeals ever. Total M&A transactions so far in 2015 total 64, up 84% from a year ago. DeVoe says the average deal size through the first half 2015 is $US877 million, up 34% year-over-year.
Some employees want their employers to provide them with a financial advisor (Financial Advisor)
A survey conducted by Activehours found 16% of employees would like their employers to provide them with a financial advisor or educational workshop. However, the most common response to how employers could help employees financially was by giving them a raise or retirement savings plan. Almost 50% of respondents gave that answer.
Wells Fargo is considering going robo (Think Advisor)
Add Wells Fargo to the growing list of wealth management firms that is considering offering clients a robo advisory option. On the conference call following Tuesday’s earnings report, CFO John Shrewsberry said there were a number of new initiatives in the works and that “At some point, it could even include a service or capability that competes with some of the robo-advisory people out there today who rely primarily on technology to construct portfolios and make offerings to customers.” According to Think Advisor, Merrill Lynch started the robo advisory movement more than five years ago.
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