Big bank stock prices, already suffering from an avalanche of difficulties, suffered another setback when news broke last Thursday that Goldman Sachs Group Inc. (NYSE:GS) had received a subpoena from the Manhattan district attorney for records relating to its role in collapse of the mortgage market.
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The subpoena served as a reminder that the fallout from the financial crisis that hit its apex in 2008 is far from over.
The banking sector already has had a rough year, as its 6% decline is the worst performance among the 10 industries tracked within the Standard & Poor's 500 Index.
"Financials have become hated in recent months," Alan Villalon, a senior bank analyst at Chicago-based Nuveen Investments, told Reuters.
The Goldman subpoena is part of a probe based on the findings of the Senate Permanent Subcommittee on Investigations, released in April. The panel's report accused the bank of profiting at the expense of clients when it bet against the mortgage market in 2007 by taking large short positions in mortgage-related securities.