U.S. markets close in 2 hours 11 minutes
  • S&P 500

    3,444.83
    +1.71 (+0.05%)
     
  • Dow 30

    28,271.00
    -37.79 (-0.13%)
     
  • Nasdaq

    11,521.61
    +5.11 (+0.04%)
     
  • Russell 2000

    1,609.74
    -7.97 (-0.49%)
     
  • Crude Oil

    39.90
    -1.80 (-4.32%)
     
  • Gold

    1,928.50
    +13.10 (+0.68%)
     
  • Silver

    25.22
    +0.24 (+0.94%)
     
  • EUR/USD

    1.1872
    +0.0044 (+0.37%)
     
  • 10-Yr Bond

    0.8030
    +0.0060 (+0.75%)
     
  • GBP/USD

    1.3163
    +0.0217 (+1.67%)
     
  • USD/JPY

    104.4900
    -0.9800 (-0.93%)
     
  • BTC-USD

    12,761.04
    +1,704.03 (+15.41%)
     
  • CMC Crypto 200

    255.79
    +10.90 (+4.45%)
     
  • FTSE 100

    5,776.50
    -112.72 (-1.91%)
     
  • Nikkei 225

    23,639.46
    +72.42 (+0.31%)
     

Fed extends buyback ban on U.S. banks into Q4

Yahoo Finance's Brian Cheung weighs in on the Fed extending its buyback shares ban on U.S. banks.

Video Transcript

[MUSIC PLAYING]

JULIE HYMAN: Time for Word on the Street, where we check in with our panel to find out what stories they are watching. Surprise, surprise, Brian is looking at the Fed and an extension of some rules and regulations that they're putting on banks into the fourth quarter.

BRIAN CHEUNG: Yes, well, probably not a good thing for anyone wanting to invest in the banking industry, but the big banks will continue to face a restriction on their capital distributions. They will not be allowed to do any sort of share buybacks and will face a cap on the amount of dividends that they can pay out in the fourth quarter of 2020.

Keep in mind that these are restrictions that the Federal Reserve had already put in place for the third quarter, the results of which are due in about two weeks or so. So the big banks, again, not able to pay out those distributions in the fourth quarter. Now, many on TheStreet already saw this as the case.

In fact, you had the likes of KBW saying weeks ago that it was probably the case that the Federal Reserve was going to extend these restrictions through the fourth quarter, which is maybe why we're not seeing too much of a reaction on TheStreet right now. You have JPMorgan Chase up about half a percent right now. The SFL Index are actually up a quarter of a percent right now. Worth mentioning one more thing that actually it's-- it was not a unanimous decision at the Fed to do this. Lael Brainard dissented from that decision after the market bell yesterday.