siegfried

These 32 Commercial Banks and Thrifts May See the Dung Hit the Fan

agree--the home equity crisis is a ticking time bomb. now take your list and cull it for banks that have already taken the hit, raised additional equity and moved on, then adjust the remainder for banks "hidden assets" like the KO stock on STI's balance sheet that will add $1 billion of equity this quarter and then cull out the banks operating in geographies that have not been hard hit. You will get banks like CMA, BBT, and SNV. Still trading above book and still under reserved. Then its a race--will they have to write down before the recession turns. If the recession lasts through the year and they have to do year end house cleaning (again) then they will trade down 20% to 30% from here. If not, then you are stuck with watching them trade between their 50 day MA and their 200 day MA for the next 2 quarters.

The Worst Is Behind Us (unless massive bank failure is considered a bad thing)

From STI conference call: "We are not enthusiastically optimistic about what’s going to go on in the home equity market. We think its going to be a pretty long haul over the next year to really if we move through the HELOC specifically. Our home equity loan portfolio is older and more mature and performing really well. It really is the brokered loans where we are really having the majority of our problems. That a little over $1.8 billion, as you look at that portfolio its going to continue to cause problems over the next two or three quarters."

Banking Breadline: The Discount Window

giving an investment banker access to the Fed window is like giving a crackhead access to a cocaine mine