Finance

POLAND – 2023/03/21: In this photo illustration, a First Republic Bank logo is displayed on a smartphone with stock market percentages in the background. (Photo Illustration by Omar Marques/SOPA Images/LightRocket via Getty Images)
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Check out the companies making headlines in midday trading.
First Republic — Shares of the regional bank fell by 43.3% after sources told CNBC’s David Faber that the most likely outcome for First Republic is to be taken into receivership by the Federal Deposit Insurance Corporate. However, there is still hope for a rescue deal to occur before the regulator would step in, the sources said.

Snap — The Snapchat parent company cratered about 17% after missing revenue expectations for the recent quarter. Snap’s revenue fell 6% from a year ago.
Amazon — The company fell 4% as investors contend with concerns over the future of Amazon’s cloud business. The company beat expectations on both adjusted earnings per share and revenue on Thursday.
Intel — Intel shares rose 4% even after the company reported its largest quarterly loss on record and a 133% reduction year over year. Even so, Intel reported a smaller-than-expected loss per share and better-than-expected revenue. Benchmark upgraded the chipmaker, saying the worst is priced into shares.
Pinterest — Pinterest’s stock plunged 15.7% after sharing disappointing second-quarter guidance. The move in shares came despite the image-sharing company’s beat on the top and bottom lines.
Charter Communications – Shares popped 7.6% after Charter Communications topped revenue expectations for the previous quarter, boosted by solid gains within its internet segment.

First Solar — The solar energy company’s stock plunged 9.1% after its first quarter results fell short of expectations. First Solar posted 40 cents earnings per share on revenues of $548 million. Analysts had estimated $1.02 earnings per share on revenues of $718 million, according to Refinitiv data.
Chevron — The energy stock rose 1% after the company beat expectations for first-quarter earnings and revenue. The strong results were boosted by its refining business, which helped offset a decline in oil and gas production amid a slide in oil prices.
Exxon Mobil — The stock gained 1.3% after the oil giant posted a record first-quarter profit before the bell, despite the pullback in oil prices.  Exxon Mobil’s adjusted earnings per share was $2.83, beating the $2.59 expected by analysts polled by Refinitiv. Its revenue of $86.56 billion also came in above the $85.41 billion expected. 
Colgate-Palmolive — The consumer giant saw its stock rally 2.4% after the company reported quarterly earnings and revenue that topped expectations. Colgate also raised annual organic sales forecast, seeing consistent price increases and solid demand for its pet nutrition products.
T-Mobile — The telecommunications stock slid 4% after first-quarter revenue disappointed expectations, according to Refinitiv. T-Mobile US reported revenue of $19.63 billion, lower than the $19.82 billion estimate.
Bloomin’ Brands — The Outback parent added 5.1% after its earnings report came in ahead of analyst expectations. The company reported 98 cents in earnings per share, above the 89 cents expected by analysts polled by Refinitiv. Revenue came in at $1.24 billion, slightly ahead of the $1.22 billion anticipated.
Alteryx – Shares of the data analytics firm tumbled about 19.4% after the company posted revenue for the first quarter that came in just below analysts’ expectations, according to FactSet, and projected a wider-than-expected loss for the second quarter. Alteryx also announced an 11% cut in its headcount.
Newell Brands — Shares gained 2.3% even after the consumer goods company reported a wider-than-expected loss. Revenue topped Wall Street’s expectations.
— CNBC’s Yun Li, Alex Harring, Brian Evans, Jesse Pound, Hakyung Kim, Sarah Min, Tanaya Macheel and Michelle Fox contributed reporting More

Mismanagement and supervisory failures, compounded by a dose of social media frenzy, combined to bring down Silicon Valley Bank, the Fed said in a report Friday.
Michael Barr, the Fed’s top bank supervisor, called for changes in the way regulators approach the nation’s complex and interwoven financial system.
Fed Chair Jerome Powell said he welcomed the Barr probe and its internal criticism of Fed actions during the crisis.

Silicon Valley Bank’s dramatic failure in early March was the product of mismanagement and supervisory missteps, compounded by a dose of social media frenzy, the Federal Reserve concluded in a highly anticipated report released Friday.
Michael Barr, the Fed’s vice chair for supervision appointed by President Joe Biden, said in the exhaustive probe of the March 10 collapse of SVB that myriad factors coalesced to bring down what had been the nation’s 17th-largest bank.

Among them were bank executives who committed “textbook” failures in managing interest rate risk, Fed regulators who failed to understand the depth of SVB’s problems and then were too slow to react, and a social media frenzy that may have accelerated the institution’s demise.
Barr called for broad changes in the way regulators approach the nation’s complex and interwoven financial system.
“Following Silicon Valley Bank’s failure, we must strengthen the Federal Reserve’s supervision and regulation based on what we have learned,” he said.
“As risks in the financial system continue to evolve, we need to continuously evaluate our supervisory and regulatory framework and be humble about our ability to assess and identify new and emerging risks,” Barr added.

A security guard at Silicon Valley Bank monitors a line of people outside the office on March 13, 2023 in Santa Clara, California.
Justin Sullivan | Getty Images

A senior Fed official said increased capital and liquidity might have helped SVB survive. Central bank officials likely will turn their attention to cultural changes, noting that risks at SVB were not thoroughly examined. Future changes could see standardized liquidity requirements to a broader range of banks, and tighter supervision of compensation for bank managers.

Bank stocks were higher following the report’s release, with the SPDR S&P Bank ETF up about 1.3%.
The report “sets the stage for far-reaching re-regulation and tougher supervision of mid-sized banks,” Krishna Guha, head of global policy and central bank strategy for Evercore ISI, said in a client note. “However, outside a reference to possible tightening of executive compensation rules that may or may not be acted on, there are few big surprises here.”
In a stunning move that continues to reverberate across the banking system and through financial markets, regulators shuttered SVB following a run on deposits triggered by liquidity concerns. To meet capital requirements, the bank was forced to sell long-dated Treasury notes at a loss incurred as rising interest rates ate into principal value.
Barr noted that SVB’s deposit run was exacerbated by fear spread on social media outlets that the bank was in trouble, combined with the ease of withdrawing deposits in the digital age. The phenomenon is something that regulators need to note for the future, he said.
“[T]he combination of social media, a highly networked and concentrated depositor base, and technology may have fundamentally changed the speed of bank runs,” Barr said in the report. “Social media enabled depositors to instantly spread concerns about a bank run, and technology enabled immediate withdrawals of funding.”
He used a broad brush in discussing the Fed’s failures, not mentioning San Francisco Federal Reserve President Mary Daly, under whose jurisdiction SVB sat. Senior Fed officials, speaking on condition of anonymity in order to speak frankly, said regional presidents aren’t generally responsible for direct supervision of the banks in their districts.
Fed Chairman Jerome Powell said he welcomed the Barr probe and its internal criticism of Fed actions during the crisis.
“I agree with and support his recommendations to address our rules and supervisory practices, and I am confident they will lead to a stronger and more resilient banking system,” Powell said in a statement.
SVB was a darling of the tech industry as a place to turn to for high-flying companies in need of growth financing. In turn, the bank used billions in uninsured deposits as a base for lending.
The collapse, which happened over the matter of just a few days, sparked fears that depositors would lose their money as many of the accounts were above the $250,000 threshold for Federal Deposit Insurance Corp. insurance. Signature Bank, which used a similar business model, also failed.
As the crisis unfolded, the Fed rolled out emergency lending measures while guaranteeing that depositors wouldn’t lose their money. While the moves have largely stemmed the panic, they spurred comparisons to the 2008 financial crisis and have led to calls for reversing some of the deregulatory measures taking in recent years.
Senior Fed officials said changes to the Dodd-Frank reforms helped spur the crisis, though they also acknowledge that the SVB case also was a failure of supervision. A change approved in 2018 reduced the stringency of stress testing for banks with less than $250 billion, a category in which SVB fell.
“We need to develop a culture that empowers supervisors to act in the face of uncertainty,” Barr wrote. “In the case of SVB, supervisors delayed action to gather more evidence even as weaknesses were clear and growing. This meant that supervisors did not force SVB to fix its problems, even as those problems worsened.”
Areas the Fed is likely to focus on include the types of uninsured deposits that raised concerns during the SVB drama, as well as a general focus on capital requirements and the risk of unrealized losses that the bank had on its balance sheet.
Barr noted that supervisory and regulatory changes likely won’t take effect for years.
The General Accountability Office also released a report Friday on the bank failures that noted “risky business strategies along with weak liquidity and risk management” that contributed to the collapse of SVB and Signature.
Correction: The General Accountability Office also released a report Friday. An earlier version misstated the name of the agency. More

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Actively managed funds have historically underperformed passive strategies, but 2022 was a better year than most for stock pickers.
Investors will have to do their due diligence, starting with an evaluation of fees and a fund’s track record.
“It’s more about looking for the right manager and the right strategy,” said Jennifer Bellis, private wealth advisor at U.S. Bank Wealth Management.

The New York Stock Exchange (NYSE) in New York, US, on Tuesday, March 28, 2023.
Victor J. Blue | Bloomberg | Getty Images

As investors navigate another uncertain year in markets, actively managed funds could add differentiated performance to their portfolios – if traders choose carefully. 
Actively managed funds have historically underperformed passive strategies, but 2022 was a better year than most for stock pickers. Only a slight majority of large-cap equity fund managers lagged their benchmarks last year, according to S&P Global’s SPIVA U.S. Scorecard. The firm noted that it was the lowest underperformance rate for the category since 2009. 

To be sure, that’s hardly a ringing endorsement. Investors can easily rack up high fees, as well as capital gains taxes, that make many actively managed funds a poor alternative to passively managed strategies that can mimic a benchmark at a lower cost. 
Still, actively managed funds can have a better chance of outperforming during periods of volatility. Plus, they beat passive strategies in some lesser-ventured categories for investors besides U.S. large caps, according to S&P’s research. 
One actively managed exchange traded fund called JPMorgan Premium Equity ETF (JEPI) has a 9.59% yield, driving investor interest in the ETF. It currently has more than $7 billion in inflows this year, according to FactSet data.

As part of its National Financial Literacy Month efforts, CNBC will be featuring stories throughout the month dedicated to helping people manage, grow and protect their money so they can truly live ambitiously.

For Jennifer Bellis, private wealth advisor at U.S. Bank Wealth Management, it depends on what the investor is trying to accomplish. Actively managed funds can help diversify portfolios, but investors will have to do their due diligence, she said.
“It’s more about looking for the right manager and the right strategy,” Bellis said. 
Here’s how investors should go about deciding whether they should include actively managed funds in their portfolio – and what they should look for when deciding.  
A good track record is key
For investors evaluating actively managed strategies, a manager’s track record is the first place to start. A strong record of performance going back three, five and 10 years can show you how the funds and their methodologies have performed across different market cycles – especially when different investing styles have fallen in and out of favor. 
“Everyone can have an up year,” Bellis said. “So what you want to do is research the fund, the manager, and look for a track record. Ideally, a 10-year history look back is what you’re looking for.” 
Investors can also review managers and their teams, as well as their tenures at the fund. They can also give the fund’s holdings a careful review to assess how the choices stack up against their benchmarks. A fund that mirrors an index too closely may not generate any differentiated alpha, and may look like passive investments. 
Also, even successful managers can have a down year, as past performance is not necessarily an indicator of future success. 
Look for lower fees
Of course, investors will have to evaluate whether an actively traded fund is right for them. 
For newer, lesser capitalized investors, passive instruments could give them the opportunity to build wealth at a far lower threshold to entry – instead of the typically higher fees and capital gains taxes, as well as the research, that come with active managers. 
Actively managed funds typically charge an expense ratio between 0.5% and 1%, but the cost can climb even higher than 1.5%, according to Investopedia. Meanwhile, passive index funds average about 0.2%. Other charges that could be tacked on include 12b-1 fees that are marketing costs. 
“Those fees aren’t necessary,” Bellis said. “So, you want to make sure that you’re reviewing the prospectus to make sure that you don’t have those front- and back-load fees because there’s plenty of funds that don’t have them. There’s no reason to pay for them.”
Check for diversification
Investors will also have to evaluate where they want to apply active strategies in their portfolio, such as emerging markets or small caps. 
“Those markets are so broad, and there’s so many ideas within them that I think an active manager who is following those markets and looking through fundamentals can exploit some of the inefficiencies or find interesting ideas,” said Kathy Carey, director of asset manager research at Baird. 
Of note, small caps had the lowest underperformance rate last year among U.S. equities, according to S&P Global’s scorecard. Just 40% of active funds in domestic small caps underperformed.
Carey also said investors seeking exposure to more specific emerging markets ideas outside of China might have better luck with an actively traded strategy, Baird’s Carey said. 
Other interesting strategies within actively managed funds include long-short and total return strategies, according to Bellis. A long-short strategy is favored among hedge funds that seek to take bets on favored stocks, while betting against stocks that could fall. A total return strategy focuses on generating income for investors. 
Baird’s Carey said investors can evaluate where active strategies could add differentiation to their portfolios. 
“Active managers, again, have the opportunity to try to figure out where the market is going.” Carey said.  More

Ask an Advisor

About a third of new crypto investors in 2022 used a friend’s suggestion as their primary reason for buying, according to the FINRA Investor Education Foundation and NORC at the University of Chicago.
Buying bitcoin, ethereum and other digital assets just on the basis of a friend’s recommendation may lead to trouble, experts say.
Investors may not understand the risk and volatility of cryptocurrency, or how it fits in a well-diversified investment portfolio.

Francesco Carta Fotografo | Moment | Getty Images

When it comes to cryptocurrency like bitcoin, new investors are often motivated by friends to take the plunge, according to a new study.
But that might hold traps for the unwary, experts warn.

“I don’t imagine friends are talking about when they lost money,” said Lee Baker, a certified financial planner and founder of Apex Financial Services in Atlanta.  
“The sexy sells,” added Baker, a member of CNBC’s Advisor Council. “The upside sells.
“But folks don’t talk about the downside,” he added.

More from Ask an Advisor

Here are more FA Council perspectives on how to navigate this economy while building wealth.

Nearly a third — 31% — of new cryptocurrency investors in 2022 used a friend’s suggestion as their primary reason for buying in, according to a recent joint study published by the Financial Industry Regulatory Authority Investor Education Foundation and NORC at the University of Chicago. Friends’ recommendations were the No. 1 motivating factor for new crypto buyers.
That share compares with 8% of new investors in more traditional assets like stocks and bonds.

The disparity indicates there is “a social element to cryptocurrency investing not evident in equities or bond investing,” according to the study.
This isn’t to say a friend’s recommendation is necessarily a poor reason to buy into the digital assets.

But it can be a “double-edged sword,” said Gary Mottola, research director at the FINRA Investor Education Foundation and a co-author of the report.
On one hand, crypto can be an on-ramp to more traditional investing — which is generally a good outcome, Mottola said. There’s some evidence of this happening: 36% of new crypto investors said their purchase made them more interested in investing in the stock market, the study found.
However, “the friends recommending [crypto], the sources of information on social media, may not be reliable,” Mottola said.

Trust but verify

The fear of missing out can be a powerful driver of investment decisions.
Bitcoin and other crypto assets rallied through 2021, a record year for the digital assets. Bitcoin jumped from roughly $10,000 in the summer of 2020 to a peak above $68,000 by November 2021.
But the tide turned quickly during a so-called “crypto winter,” when investors lost more than $2 trillion in the year following the market peak.

The sexy sells. The upside sells. But folks don’t talk about the downside.

CFP and founder of Apex Financial Services

Celebrities, like actress Lindsay Lohan and the rapper Soulja Boy, were recently fined by the Securities and Exchange Commission for undisclosed endorsements of various cryptocurrencies.
“Unless they’re some legitimately knowledgeable financial person, trust but verify,” Baker said of information you may hear from friends or from “pseudo experts” on social media.
One of the dangers of following a friend’s advice: Investors may not understand the risks and volatility associated with crypto (or other investments), or how it fits within a broader, well-diversified investment portfolio, he said.

Another potential trap: You may be getting a friend’s recommendation when the market is nearing its top, when much of the growth potential has already been realized.
Bitcoin’s current value around $30,000 is nearly double what it was at the beginning of 2023. Baker expects he may soon be fielding more phone calls about crypto if the trend continues.
“If you’re doing some investigation [about crypto], I think it’s great,” Baker said. “If you’re just taking information blindly without doing any investigation, that’s a horrible idea.” More

The Amazon logo on a locker in Annapolis, Maryland, on February 2, 2023, ahead of earnings report.
Jim Watson | AFP | Getty Images

Check out the companies making headlines in premarket trading.
Capital One — Shares were down 3.3% after disappointing quarterly earnings. The company earned an adjusted $2.31 per share, well below a StreetAccount forecast of $3.75 per share. Capital One executives cited difficulty with lending throughout the quarter.

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Snap — Shares tumbled 18.2% after the company’s first-quarter revenue fell short of Wall Street’s expectations. Snap’s revenue fell 6% from the prior year to $989 million, whereas analysts had expected $1.01 billion, according to Refinitiv data.
Amazon — Amazon dipped 2.4% Friday morning after the e-commerce giant cited concerns over its cloud business going forward. That overshadowed a revenue beat for the first quarter.
T-Mobile — The telecommunications company were down about 2% Friday morning after reporting quarterly results. The company beat on adjusted earnings per share with $1.58 against a StreetAccount estimated $1.52. However, T-Mobile missed estimates on revenue and monthly subscriber additions.
Exxon Mobil — Shares added 1% in the premarket after the oil giant reported a record first-quarter profit. Exxon Mobil’s adjusted earnings per share came in at $2.83, topping analysts’ estimates of $2.59, per Refinitiv. Its revenue of $86.56 billion also beat the $85.41 billion expected.
Chevron — Shares of Chevron dipped slightly in the premarket despite a first-quarter earnings beat. The oil major’s adjusted earnings per share was $3.55 versus the $3.41 expected by analysts polled by Refinitiv. Revenue also beat, but net profit in Chevron’s oil and gas division dropped 25% on the drop in oil prices.

Intel — Shares of the chipmaker rose 6% in premarket trading despite Intel reporting a net loss of $2.8 billion in the first quarter. The company did beat Wall Street estimates for the quarter, with Intel reporting an adjusted loss of 4 cents per share on $11.72 billion of revenue. Analysts surveyed by Refinitiv were looking for a loss of 15 cents per share on $11.04 billion of revenue.
First Solar — The solar panel manufacturer declined more than 8% in early trading after an earnings miss. The company reported 40 cents per share adjusted on $548.29 million in revenue, while a StreetAccount estimate called for 99 cents per share.
Alteryx — Software company Alteryx fell 18% in premarket trading. The company reported an adjusted loss of 19 cents per share while analysts polled by StreetAccount estimated a loss of 26 cents. Management told investors that the company planned to layoff 11% of staff as part of a cost reduction plan.
L3 Harris Technologies — The tech and defense company gained 2.5% after narrowly beating earnings estimates, with an adjusted $2.86 per share against a StreetAccount estimate of $2.85 per share.
First Republic — The beleaguered bank added 5.3% on Friday on news that U.S. officials were in the process of assembling a rescue plan. The lift comes after the bank said deposits fell a staggering 41% throughout the latest quarter on Monday.
Pinterest — Shares of the image sharing platform tumbled 14% in premarket after the company issued disappointing guidance for the quarter ahead. Pinterest said second-quarter revenue growth will be lower than expected amid higher operating expenses. Pinterest’s first-quarter earnings and revenue did beat expectations, however.
— CNBC’s Hakyung Kim, Samantha Subin, Jesse Pound, Yun Li and Michelle Fox contributed reporting More

The central bank played a key role in brokering the rescue of embattled lender Credit Suisse over the course of a chaotic weekend in March.
Thomas Jordan, chairman of the governing board at the SNB, said banking regulation and supervision will have to be reviewed in light of recent events.
The demise of the country’s second-largest bank fomented widespread discontent and severely damaged Switzerland’s long-held reputation for financial stability.

Thomas Jordan, president of the Swiss National Bank (SNB), speaks during the bank’s annual general meeting in Bern, Switzerland, on Friday, April 28, 2023.
Bloomberg | Bloomberg | Getty Images

The Swiss National Bank on Friday pledged to review banking regulations during its annual general meeting in Bern, following recent turmoil involving Credit Suisse.
Set against a backdrop of protest over its action on climate change and its role in the emergency sale of Credit Suisse to Swiss rival UBS, Thomas Jordan, chairman of the governing board at the SNB, said banking regulation and supervision will have to be reviewed in light of recent events.

“This will require in-depth analysis … quick fixes must be avoided,” he said, according to a statement.
The central bank played a key role in brokering the rescue of Credit Suisse over the course of a chaotic weekend in March, as a flight of deposits and plummeting share price took the 167-year-old institution to the brink of collapse.
The deal remains mired in controversy and legal challenges, particularly over the lack of investor input and the unconventional decision to wipe out 15 billion Swiss francs ($16.8 billion) of Credit Suisse AT1 bonds.
The demise of the country’s second-largest bank fomented widespread discontent and severely damaged Switzerland’s long-held reputation for financial stability. It also came against a febrile political backdrop, with federal elections coming up in October.
Jordan said Friday that future regulation will have to “compel banks to hold sufficient assets which they can pledge or transfer at any time without restriction, and which they can thus deliver as collateral to existing liquidity facilities.” He added that this would mean his central bank could would be able to provide the necessary liquidity, in times of stress, without the need for emergency law.

A shareholder holding a placard reading in German: “Invest in the planet and not in its destruction” takes part in a protest ahead of a general meeting of of the Swiss National Bank (SNB) in Bern on April 28, 2023. (Photo by Fabrice COFFRINI / AFP) (Photo by FABRICE COFFRINI/AFP via Getty Images)
Fabrice Coffrini | Afp | Getty Images

The SNB faced questions and grievances from shareholders about the Credit Suisse situation on Friday, but the country’s network of climate activists also sought to use the central bank’s unwanted spotlight to challenge its investment policies.
Unlike many major central banks, the SNB operates publicly-traded company, with just over half of its roughly 25 million Swiss franc ($28.1 million) share capital held by public shareholders — including various Swiss cantons (states) and cantonal banks — while the remaining shares are held by private investors.
More than 170 climate activists have now purchased a SNB share, according to the SNB Coalition, a dedicated pressure group spun out of Alliance Climatique Suisse — an umbrella organization representing around 140 Swiss environmental campaign groups.
Around 50 of the activist shareholders were attendance on Friday, and activists had planned to make around a dozen speeches on stage at the AGM, climate campaigner Jonas Kampus told CNBC on Wednesday. Protests were also held outside the event with Reuters reporting that the campaigners totaled 100, leading to tight security.
The group is calling for the SNB to dispose of its stock holdings of “companies that cause serious environmental damage and/or violate fundamental human rights,” pointing to the central bank’s own investment guidelines.
In particular, campaigners have highlighted SNB holdings in Chevron, Shell, TotalEnergies, ExxonMobil, Repsol, Enbridge and Duke Energy.
Members of a Ugandan community objecting to TotalEnergies’ East African Crude Oil Pipeline, were also set to attend on Friday, with one planning to speak on stage directly to the SNB directorate.
As well as a full exit from fossil fuel investments, activists are demanding that the SNB implement the “one for one rule,” — a capital requirement designed to prevent banks and insurers benefiting from activities that are detrimental for the transition to net zero.
In this context, the SNB would be required to set aside one Swiss franc of its own funds to cover potential losses for each franc allocated to financing new fossil fuel exploration or extraction.

Ahead of the AGM, the central bank declined on legal grounds to schedule three motions tabled by the activists, and said on Wednesday that it would not comment on protest plans, instead directing CNBC to its formal agenda. Yet Kampus suggested that just the process of submitting the motions itself had helped expand public and political awareness of the issues.
“From all sides, there is public pressure and also political pressure that the SNB needs to change things. At this moment, the SNB is really far behind in terms of their actions taken compared to other central banks,” Kampus told CNBC via telephone, adding that the SNB takes a “very conservative view” of its mandate regarding price stability and financial stability, which is “very narrow.”
The shareholders’ cause is also backed by a motion in parliament, with support from lawmakers ranging from the Green Party to the Centre [center-right party], which demands an extension of the SNB’s mandate to cover climate and environmental risks.
“While other central banks around the world are going well beyond the steps taken by the SNB in ​​this respect — the SNB has repeatedly taken the position that its mandate does not give it sufficient leeway to take climate risks fully into account in its decisions and monetary policy instruments,” reads the motion, filed on March 16 by Green Party lawmaker Delphine Klopfenstein Broggini.

“The present parliamentary initiative is intended to ensure this leeway and to make it clear that the SNB must take climate risks into account when conducting monetary policy.”
The motion argues that climate risks are “classified worldwide as significant financial risks that can endanger financial and price stability,” concluding that it is in “Switzerland’s overall interest that the SNB proactively address these issues” as other central banks are seeking to do.
Kampus and his fellow activists hope the national focus on the SNB after the Credit Suisse crisis provides fertile ground to advance concerns about climate risk, which he said poses a risk to the financial system that is “several times larger” than the potential fallout from Credit Suisse’s collapse.
“We feel that there is also a window of opportunity on the SNB side in that they maybe this time are a bit more humble, because they obviously also have done some things wrong in terms of the Credit Suisse crash,” Kampus said.
He noted that the central bank has always asserted that climate risk was incorporated into its models and that there was “no need for further exchange with the public of further transparency.”

“Very central to the SNB’s work is that the public just needs to trust them. Trust is something that is very important to the central bank, and to demand trust from the public without leading up to it or supporting it with further evidence that we can trust them in the long run is quite scary, especially when we don’t know what their climate model is,” he said.
The SNB has long argued that its passive investment strategy, which invests in global indexes, is part of its mandate to remain market neutral, and that it is not for the central bank to engage in climate policy. Activists hope mounting political pressure will eventually force a change in legislation to broaden the SNB’s mandate to accommodate climate and human rights as risks to financial and price stability.
UBS and Credit Suisse also faced protests from climate activists at their respective AGMs earlier this month over investment in fossil fuel companies. More

More than two months since the ChatGPT craze hit China, a similar artificial intelligence-based product has yet to reach the country’s population at large.
The most well-known alternatives released by Baidu, Alibaba and others have limited access with waitlists — or restricted trials to business partners.
ChatGPT, which learns using big data, reached an estimated 100 million monthly active users two months after launching in November.

Baidu CTO Wang Haifeng speaks at the unveiling of Baidus AI chatbot Ernie Bot at an event in Beijing on March 16, 2023.
Michael Zhang | Afp | Getty Images

BEIJING — More than two months since the ChatGPT craze hit China, a similar artificial intelligence-based product has yet to reach the country’s population at large.
Instead, the most well-known alternatives released by Baidu, Alibaba and others have limited access with waitlists — or restricted trials to business partners.

In what has been compared to an “iPhone moment,” ChatGPT reached an estimated 100 million monthly active users two months after launching in November. The AI-chatbot learns using big data and can generate everything from poems to business strategies in a human-like conversation.
But ChatGPT, created by U.S.-based OpenAI, isn’t available in China, where access to Twitter, Facebook and Google is also banned via the government’s internet firewall. Beijing this month also released draft rules for regulating AI-generated content, with a public comment period until May 10.
Those restrictions haven’t stopped the Chinese press and social media in general from talking frequently about ChatGPT and AI tech. Some people tried to buy overseas ChatGPT accounts on Chinese e-commerce sites.

Domestic companies rushed to release and test alternative products. Accumulating big data and machine learning experience are integral to the tech behind ChatGPT.
So far, publicly available figures indicate similar AI products in China are not as widely available.

Alibaba Cloud said Wednesday it received more than 200,000 requests from businesses to test the company’s version of ChatGPT-style tech, called Tongyi Qianwen. The product was announced on April 11.
One of those business partners, Kunlun Tech, launched the “Tiangong” on April 17 which can interact with users in a question-and-answer format. The product is currently invite-only. Kunlun claims Tiangong is the only chatbot in China with training metrics at the level of ChatGPT.
Similarly, it’s not clear how many people have gained access to Baidu’s Ernie bot.
Just under a week after its launch on March 16, the chatbot had more than 1.2 million people on a waiting list. The company stopped disclosing numbers within a few days. No update was available Friday.

Read more about China from CNBC Pro

When CNBC tried to sign up for Ernie bot in March, the Baidu system required a mainland Chinese phone number and local ID in order to use the chatbot. More apps in China now require ID verification, or strongly encourage it.
Baidu this week said that since Ernie bot’s launch, it had updated the product four times, and reduced costs for operating the AI model to one-tenth of what it was previously.
The public version of Ernie bot allows users to generate English and Chinese text, images and audio.
In the U.S., new AI-based products from Google and Microsoft also have waitlists. ChatGPT isn’t consistently usable due to server capacity. Some in the industry also expect such AI tools will be easier to commercialize for business products than for public tools such as search.

Development challenges

Regulatory uncertainty lingers while Beijing remains in a comment period for its generative AI draft rules. Authorities have not announced when a final version of the rules would take effect.
Outside China, the U.S. and Europe have generally been lax on ChatGPT, except for Italy, which this month banned the chatbot until OpenAI addresses privacy issues.
A bug had given ChatGPT users temporary access to other people’s conversations. OpenAI this week said it released incognito-like features that allow users to turn off chat history and opt out of having their data used for training its models.
Another challenge for companies in China will be obtaining the most advanced chips for training AI models. The U.S. in October announced stringent export bans aimed at restricting China’s access to high-end semiconductors.
A model at the level of OpenAI’s GPT-3 requires at least 1,000 Nvidia A100 graphics processing units, a kind of chip known as GPUs, to complete one 23-day round of training, HSBC analysts said in an April 20 report.
More than 30 companies and institutes in China are training such AI models, indicating “robust demand for AI server and increased spending on networking infrastructure,” the report said.
The analysts said they expect AI GPU demand in China to grow by more than 40% this year.
Another estimate, based on checks with cloud providers, predicts that demand to at least double — contributing to a “significant shortage” of chips, according to a representative of a firm investing in AI models, who requested anonymity due to the sensitivity of the topic.
On regulation, the source said authorities are supportive of ChatGPT-style tech while planning to regulate it — companies anticipate they will need licenses to operate ChatGPT-like tech and are preparing for applications.
— CNBC’s Michael Bloom and Ashley Capoot contributed to this report. More

A robot prepares to pick up a tote containing product at the Amazon Robotics fulfillment center on April 12, 2019 in Orlando, Florida.
Nurphoto | Nurphoto | Getty Images

Check out the companies making headlines after hours.
Amazon – Amazon jumped 7% in extended trading after reporting a first-quarter revenue beat. The online retail giant posted revenue of $127.4 billion, greater than the $124.5 billion consensus estimate published by Refinitiv. 

related investing news

Intel – Intel shares were down 1.2% after initially rising in the wake of its first-quarter results. The semiconductor firm reported its largest-ever quarterly loss. However, it did beat analysts’ expectations on the top and bottom lines. The semiconductor firm posted a first-quarter loss of 4 cents per share ex-items on revenue of $11.7 billion. Analysts polled by Refinitiv forecasted a loss per share of 15 cents on revenue of $11.04 billion.
Snap – The social media stock tumbled nearly 20% in extended trading Thursday after the firm’s first-quarter results. Snap reported first-quarter revenue of $989 million, lower than the estimated $1.01 billion, according to Refinitiv data. On the other hand, Snap earned 1 cent per share, excluding items, which was better than the forecasted per-share loss of 1 cent. 
Pinterest – Pinterest shares dropped 8%. The image sharing firm surpassed expectations on the top and bottom lines in its first quarter, according to consensus estimates from Refinitiv. However, second-quarter revenue growth expectations were disappointing. The firm expects operating expenses to grow in the low teens. 
Boston Beer – Boston Beer shares slid 3.2% in extended trading. The brewery behind Samuel Adams and Twisted Tea brands missed analysts’ expectations on the top and bottom lines, according to Refinitiv data. 
First Solar – The solar stock shed more than 5% on disappointing first-quarter results. The firm reported earnings of 40 cents per share on $548 million in revenue. Analysts expected per-share earnings of $1.02 on revenue of $718 million, according to Refinitiv.

T-Mobile US – T-Mobile US shares declined as much as 2.5% after first-quarter revenue for the telecommunications firm came in lower than expected, according to Refinitiv.
Cloudfare – Cloudfare tumbled 23% in extended trading after posting weaker-than-expected first-quarter revenue and issuing a lackluster second-quarter and full-year forecast.
L3Harris Technologies – L3Harris Technologies added more than 3% in extended trading after beating first-quarter earnings and revenue expectations. The defense contractor posted first-quarter earnings of $2.86 per share ex-items on revenue of $4.47 billion. Analysts surveyed by Refinitiv expected per-share earnings of $2.85 on revenue of $4.25 billion.
Amgen – Amgen declined 2.2% after disappointing first-quarter revenue expectations. The biotech firm reported $6.11 billion in revenue, lower than estimates of $6.17 billion from analysts polled by Refinitiv. Amgen did beat on earnings expectations.
Fair Isaac – Shares fell 2% after Fair Isaac missed earnings estimates in its second quarter, though it did beat on revenue expectations. The data analytics firm behind the FICO score reported adjusted earnings of $4.78 per share, weaker than the consensus estimate of $5.04 per share, according to Refinitiv.
Gilead Sciences – Shares of the biopharmaceutical company fell about 1% in extended trading after it reported disappointing earnings, but topped revenue expectations, according to Refinitiv data.
Mondelez International – Mondelez International climbed 2% after posting first-quarter results that exceeded expectations on the top and bottom lines, according to consensus expectations from Refinitiv. More