Thread: Analysts Say More Banks Will Fail

Analysts Say More Banks Will Fail
by Louise Story
Monday, July 14, 2008
provided by


As home prices continue to decline and loan defaults mount, federal regulators are bracing for dozens of American banks to fail over the next year.

But after a large mortgage lender in California collapsed late Friday, Wall Street analysts began posing two crucial questions: Just how many banks might falter? And, more urgently, which one could be next?

The nation’s banks are in far less danger than they were in the late 1980s and early 1990s, when more than 1,000 federally insured institutions went under during the savings-and-loan crisis. The debacle, the greatest collapse of American financial institutions since the Depression, prompted a government bailout that cost taxpayers about $125 billion.

But the troubles are growing so rapidly at some small and midsize banks that as many as 150 out of the 7,500 banks nationwide could fail over the next 12 to 18 months, analysts say. Other lenders are likely to shut branches or seek mergers.

“Everybody is drawing up lists, trying to figure out who the next bank is, No. 1, and No. 2, how many of them are there,â€

HERE IS THE BOVE LIST. AS FAR AS I KNOW IT IS THE LATEST. BUT IT WILL PROBABLY CHANGE REAL QUICK TOO.


http://a11news.com/363/who-is-next-bove/


The formula is non-performing assets + 90-days late loans divided by bank reserves + common equity. Any financial institution with a ratio over 5% is at risk.

Who Is Next Bove List:

IBERIABANK Corporation - IBKC - 8.7%
Webster Financial Corporation - WBS - 8.6%
Fulton Financial Corporation - FULT - 8.4%
Bank of America Corporation - BAC - 8.0%
Provident Bankshares Corporation - PBKS - 7.9%
Regions Financial Corporation - RF - 7.8%
Cathay General Bancorp - CATY - 7.7%
Sovereign Bancorp, Inc. - SOV - 7.6%
First Midwest Bancorp, Inc. - FMBI - 7.4%
Wilmington Trust Corporation - WL - 7.4%
M&T Bank Corporation - MTB - 7.3%
TFS Financial Corporation (MHC) - TFSL - 7.2%
WesBanco, Inc. - WSBC - 7.0%
U.S. Bancorp - USB - 6.8%
NBT Bancorp Inc. - NBTB - 6.7%
Umpqua Holdings Corporation - UMPQ - 6.6%
City National Corporation - CYN - 6.3%
East West Bancorp, Inc. - EWBC - 6.1%
BOK Financial Corporation - BOKF - 6.1%
Capital One Financial Corporation - COF - 5.8%
Susquehanna Bancshares, Inc. - SUSQ - 5.6%
MB Financial, Inc. - MBFI - 5.6%
United Bankshares, Inc. - UBSI - 5.4%
JPMorgan Chase & Co. - JPM - 5.2%

A good stock play on the Who Is Next list by Richard X. Bove of Ladenburg Thalman would be to buy put options because the stocks in this list aren’t going back up anytime soon.

And that’s the latest news on at-risk financial institutions on the Who Is Next Bove list.