The single most common request - Top of the FAQs - we get at Banking Technology is from PR people looking for synopses based on the Forward Features list.

The single most common answer isn’t really fit even for the web, so I thought it might make some sense to set out some of the reasons that it’s not a good question: for a start it hasn’t got a single answer.

Firstly, magazine forward features lists were historically created for the advertising and sales side of the operation. Editors hate them: at best they are done out of a grudging recognition that the sales people have to eat (and if they don’t eventually we all starve); at worst they are done in a spirit of parody. One of my predecessors calls it the Forward Features Lies, and he has a point.

The simple fact is that no journalist has any idea what they are going to be writing about in a year’s time in anything other than a vague way. Sure, BBC Good Food Magazine will be doing something on al fresco dining in its July issue; but other than trade shows and conferences, us trade ‘n’ tech hacks haven’t got much each month.

Which brings us to the second aspect of the Forward Features list, which is its role in the media pack. Writing down all the things that a mag might possibly cover that advertisers and subscribers might be interested in - why else put them in the media pack? - is a way of setting out the stall.

The US phrase “Editorial Calendar” adds another twist here, as some people seem to assume that those subjects only get covered if they are mentioned in the FFL - sorry, I even got fed up typing it - and we have conversations along the lines of “I see you’re writing about Blah in November …” to which the only answer can be “We’re Blah Monthly. We write about Blah every issue.”

Thirdly, from a writer’s point of view, there really is no such thing as a feature: they are all just pieces. Different lengths, different deadlines, different subjects - that’s all. The basic thing is to talk to people - on the phone, in the pub, whatever - and write down what they say. Then the next time you talk to someone about that subject, you have a little more knowledge and the story grows, especially if there is any discrepancy between them. And so it goes.

So when people ask for a synopsis for a particular feature, it’s pretty hard to answer honestly without being patronising and rude - and quite frankly, if you phone up looking for a synopsis of a feature called something like Vienna: A Guide to the City’s Irish Pubs and ask, “what angle are you taking?” then you’ll be lucky to get away with being rudely patronised, even before lunch.

Which brings me to the fourth - and last, for now, point: PRs don’t really care what the angle is anyway - what they want to know is if there is any chance that their client can get a mention in the upcoming supplement on the “Irish Bars of Venice”, or whatever garbled nonsense has turned up on the various feature compilation services that abound; “Venetian Blinds in Iceland”, quite possibly.

The answer to that is simple: does the client have an Irish Bar, in Vienna?

Really? Then you’d better tell us all about it: it might be just the thing we’re looking for …

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The largest US banks are expending more effort in online marketing and getting results in the form of increased account balances, improved retention and more products per customer, says the Aite Group’s Ron Shevlin in a new report.

“Considering trends in consumer behavior, Aite Group believes many institutions are digging a hole for themselves by underinvesting in online marketing.”

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Ah, sweet revenge. Chinese leaders are offering the US advice on how to run its economy, and a bit of criticism on its performance so far, reports Edward Wong in The New York Times. The Chinese have called America’s concept of economic regulation “warped,” and called on the country to halt the dollar’s decline. America overestimates the power of the market and overlooks the regulatory role of government, said one critic.

He’d probably find a lot of Americans agreeing with him

It’s just been a few years since I was at a SunGard user group meeting in New Orleans where a Chinese banker explained he was implementing Panorama for risk management in part to learn how Americans approached risk management.

Sure seems like a long time ago.

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Some outlines of regulatory changes are starting to take shape. My guess is that US investment banks will see increased regulation in return for the Fed’s intervention in the case of Bear Stearns and its decision to allow investment banks to borrow from it.

The Fed’s approach will be to that the cowboys of finance are really on their own. So Timothy F. Geithner, president and chief executiveof the Federal Bank of New York, told The Economic Club of New York, that he doesn’t see a need to extend capital requirements to hedge funds or private equity firms – the cowboys.

But the cowboys can’t be allowed to threaten systemic risk, which means the brokerage firms will be monitored for their exposures…Regulated firms will probably carry more capital.

Geithner again: “Supervision has to explicitly focus on inducing higher levels of margin and collateral in normal times against derivatives and secured borrowing to better cover the risk of market illiquidity.”

Writing in the NY Times, Louise Story asked around the industry for predictions.

“They are going to have to build a new business model,” Richard X. Bove, a financial services analyst at Ladenburg Thalmann and Company, said of investment banks. “I do not believe those businesses have the ability to generate the kind of profit they did in recent years without all the leverage.”
Some analysts predict that independent brokerage houses will merge with commercial banks, if the government begins regulating them. That uncertainty leaves executives at these companies unsure of how to plan for the future, said David Trone, an analyst at Fox-Pitt Kelton Cochran Caronia Waller, who is predicting bank consolidation.

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James Tisch in the Wall Street Journal commenting on the banking crisis:

“If there’s nothing to do, do nothing. But many CEOs can’t so that. If you’re an action junkie, it’s going to get you in trouble.”

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Visualisation makes sporadic appearances in financial services. At SIFMA in New York last week, complex events processor Aleri showed a neat trading dashboard with excellent graphical tools developed by Lab49 in New York. Now Financial Insights has published a piece on visualisation with real world examples such as Credit Suisse’s CrossFinder+, a visual heat map for deep liquidity pools. A decent account of what’s available and who can get the best value from it.

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When you think about it, a bank and a hotel have a certain similarity. The customer-facing staff stand behind high counters and work with computers.
We arrived at Sofitel St. James around noon on a recent Saturday to prepare for a friend’s wedding. The woman on reception used her phone to check before informing us the room wouldn’t be ready for half an hour – still ahead of the published check-in time. Would we like to have coffee in the bar while we waited, she asked, coming out from behind the counter to hand us a voucher and direct us to the bar across the lobby.
Twenty minutes later she came to the bar and told us the room was ready.
It might have been, but we couldn’t tell because our card keys didn’t work. Another woman at reception ran the keys again and came up with me to ensure they would work. They didn’t, but she used her key to let us in and promised to have an electrician fix the lock while we were out picking up rented tails for the wedding.
When we returned, we picked up our keys and everything worked.
Besides the unfailing courtesy, what impressed me was how proactive people were, and how they didn’t use the desk as a barrier to keep away from customers. They repeatedly came around it to engage and to be helpful.
Umqua Bank in Washington, a leader in service, sends staff to Ritz Carlton for training. English banks could do worse than spring for an occasional weekend at the Sofitel for a few of their people.

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For a couple of weeks I have been writing about banking and regulation and the possibility, make that likelihood, that a Democratic regime in the US will be looking at an extensive set of new regulations. Is the financial services industry making any effort to get out in front of this?
Not as far as I can see.
Earlier this week the FT reported that regulators are looking at international cooperation to develop some standards so they won’t get gamed by financial firms. Today the FT’s Gillian Tett, one of my favorite finance writers, says bankers don’t see a regulatory threat.

“ In normal times, bankers tend to be pretty cynical – even scathing – about what these regulators might think. (Indeed, one top representative from PWC had the temerity to declare in Cannes this week that the industry already had the regulators “under control”, although he noted the European parliament was less malleable.)”

The NY Times today reports that not just the Richmond Federal Reserve president but also his counterpart in Philadelphia are expressing concerns about the bailout of Wall Street. Some of the district Fed presidents who represent the real economy might lean on Washington and New York to put some rigorous controls in place. After the Greenspan fallout, I think the regional bank heads will be less inclined to accept central leadership in awed silence.

“Take the matter of the capital treatment of trading books,” notes Tett. “In recent weeks, some Western supervisors have conducted intensive analysis on banks’ trading books and discovered, to their horror, that some banks have been exploiting so many regulatory loopholes in recent years that they have got away with posting virtually no capital reserves against assets, such as the senior tranches of CDOs.”

I am still looking for signs someone on the industry side is looking at this seriously. Will let you know if I find any signs of intelligent life.

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Ah, here is a fresh idea from Charles Goodhart and Avinash Persaud  in the FT: give bank supervisors hefty bonuses that pay out over five years or so if the firms in their purview stay profitable.

Next on their menu is a revision to Basel II capital adequacy requirements that raises them by a ratio linked to the growth of the value of bank assets, bank by bank.

“Focusing on value will help lessen the procyclicality of fair value, mark-to-market accounting and value-at-risk models.”

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Deutsche Bank’s CEO Josef Ackerman touched off a storm a few weeks ago as chair of the Institute of International Finance when a working paper there suggested revisions to mark-to-market because values in an illiquid market “results in valuations that do not provide a true picture of the financial positions of the firms.” Meanwhile the UK FSA has chimed in, saying it may consider employee compensation plans when judging the risk of an institution. Ouch. More risk, higher capital requirements?
Do large cash bonuses lead to outsized risks? (one prelimary step might be to look at risk adjusted returns which apparently JPMorgan already does. And they also came through the current problems pretty well … hmm) which the ICF seems to be in favour of. The FT thinks the reforms might take hold because ramifications from the banking crisis have extended far beyond the investment banks.
Banks worry that the first change will be that it will lose its best people. Regulation could help there, and coordination among the major financial centers could keep traders from hopping oceans to find a bank that continues to pay big bonuses.

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