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Financial Crisis Investing

Controversial Stress Tests Reveal Only One Bank Needs Capital, but Worries Remain

By William Patalon III Executive Editor Money Morning/The Money Map Report Only one of the 19 financial institutions that received a bank stress test would require additional capital, the controversial government initiative has reportedly concluded. The identity of the bank that is alleged to have failed the bank stress test was not revealed. The bank-stress-test […]

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Stress Tests Put Obama Administration in "No-Win" Situation

By Don Miller Associate Editor Money Morning The Obama administration may have backed itself into a corner when it released the details of the "stress test" methodology being used to evaluate the health of the nation's big banks.  With final results not expected to be released until May 4, releasing the testing methods for Citigroup […]

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How Long-Short Investing Can Lead to Profits in Today's Uncertain Markets

[This is the eighth installment of a new series that looks at ways for investors to recover from the U.S. financial crisis. To check out the archive of previous stories in the series, just click on the series logo.] Long-short investing strategies aren’t just for hedge funds anymore. Many investors believed diversified “long-only” portfolios would […]

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A Look at Liquidity: The Real Reason Banks Aren’t Lending

[Editor's Note: In this second installment of a two-part look at whether the credit crisis continues to crimp financing for companies and consumers, Money Morning takes a look at bank lending. In Part I earlier this week, we studied venture-capital-investment trends.] By Don MillerAssociate EditorMoney Morning  Since the Obama administration took office almost 100 days […]

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A Look at Liquidity: Venture Funding Hits 12-Year Low Amid Cold IPO Market

[Editor's Note: In this first installment of a two-part look at whether the credit crisis continues to crimp financing for companies and consumers, Money Morning looks at the venture capital market. In Part II later this week, we'll study bank lending trends.] By Mike Caggeso Associate Editor Money Morning Capital venture firms in the Unites […]

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Financial Crisis Investing: How to Profit Even if the Current Bull Market Rally is Really a Bear Market Fake

[This is the seventh installment of a new series that will explore ways for investors to recover from the U.S. financial crisis. To reach an archive of previous stories in the series, please just click on the series logo.] By Mike Caggeso Associate Editor Money Morning U.S. stocks just capped off their strongest two-week performance […]

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Seven Ways to Get an Income-Tax Boost From the Obama Recovery Plan

So what will $800 billion buy these days?  At the macro level, the Obama administration's rescue plan will buy some new roads and bridges, 3.5 million new jobs and, hopefully, an economic recovery in the process. On an individual level, the benefit will come from the mix of tax benefits that are part of the […]

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Three Reasons Bank Nationalization Will Keep Investors Awake at Night

By Martin HutchinsonContributing EditorMoney Morning It’s a tough time to be a bank shareholder. You’re not just worrying about whether the ongoing recession or a further lurch downwards in housing prices is going to decimate the value of your bank’s loan portfolio. You’re also worrying about whether some government “stress test” or – worse still […]

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Fifth Third – A Medium-Sized "Zombie" Bank

By Martin Hutchinson Contributing Editor Money Morning Following my report on the viability of the Top 12 U.S. banks, a number of readers have suggested that I missed Fifth Third Bancorp (FITB). I’m happy to report that it wasn’t an oversight: The reality is that Fifth Third – with $120 billion in assets – didn’t […]

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The Top 12 U.S. Banks: From Zombies to Hidden Gems

U.S. Treasury Secretary Timothy Geithner last week proposed a series of programs, totaling $1.5 trillion, to bail out the U.S. banking system. Of course, Geithner hasn't told us precisely how he plans to spend the money, or identified which banks require such an enormous outlay.

So I thought it was worth looking at the United States' 12 largest banks to see where the problems might be and identify which banks might need big infusions of government cash. I perused the financial statements of all 12 banks, and also looked at their market valuations.

Unlike when the Troubled Assets Relief Program (TARP) was proposed in September – when the projections for potential losses were largely financial conjecture – we now have important concrete data on the banking system's troubles; namely, each of the bank's annual financial reports for 2008.

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