Voice of Reason

National City Corporation Shopping for a Buyer

As so often happens NCC has been beaten down by the street far below it's true value. This is (was) the country's 9th largest bank with roughly 140 billion in assets. Oh wait a minutue, that subprime mortgage "problem" we keep hearing about.

Well it is really as bad as the fearmongers want Joe Average to believe?

The FACT is it seems to be the chicken little crowd getting their feathers all ruffled up over much of nothing again. NCC reports it big "bad" subprime mortgage holdings that are not performing at 4.4%. Well that mean 95% is STILL above water! Also factor in that banks including NCC have been stupidity and foolishly writing down book value of this paper probably far in excess of real value.

Get it? Sure the subprime mess isn't good, and NCC was damn stupid to get into subprime in the first place, but no way this is that bad a problem either. Better, with NCC one of the largest holders of the new Visa IPO it has/will rake in about 500 million from that which is a much needed shot in the arm.

Over the last week to 10 days the morons... oops I mean those next to useless moronic analysis crowd that can't find their rear ends with both hands behind their back have been upgrading NCC from underperform and hold to buy. That plus merger talk and much if not all the bad news already discounted and factored into the stock price and book value way higher than the current stock price, I'm holding. I'm long several so-called distressed bank stocks.

Disclosurer:

I got into NCC via backdoor being a very long term holder of MAFB which NCC bought last summer. Why didn't I sell? Oh, maybe because I have a cost basis of a little over a dollar. So, still sitting pretty all things considered.