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Equities: Rally Revives as DJIA Hits Year's Highs [View article]
MarketWatch:
Thinking the worst is behind the industry, investors began looking to 2010 and 2011 when banks should be a lot healthier, according to Richard Bove, an analyst at Rochdale Securities. Third-quarter results will make that leap of faith harder to maintain, he said.
"Third-quarter earnings for most banks, particularly the regional lenders, will be extraordinarily negative," Bove said.
He estimates that about 60% of banks will report losses in the period as nonperforming assets continue to grow and charge-offs remain very high. Lenders will also have to increase reserves because they didn't bolster them enough during the second quarter, Bove added.