The most non-news news item in many years, but chalk it up in the good news category, if only because it seems to indicate some glimmer of reality leaking into proceedings. Some excerpts:
The findings suggest that government officials are using the stress tests to send a tough message to struggling banks. Bank of America and Citigroup have been the highest-profile problem children in recent months, but it is unlikely that they are the only banks the Federal Reserve has determined might need more capital.
Industry analysts and investors predict that some regional banks, especially those with big portfolios of commercial real-estate loans, likely fared poorly on the stress tests. Analysts consider Regions Financial Corp., Fifth Third Bancorp and Wells Fargo & Co. to be among the leading contenders for more capital. Wells Fargo declined to comment. Representatives of Regions and Fifth Third didn't respond to requests for comment made late in the day.
Not surprisingly, the geniuses who led us into this disaster are still in denial:
Executives at both banks
And, under the bad news column, file this gem of illogic:
....banks directed to raise more capital shouldn't be viewed as insolvent.
Two more little bits from the article I found amusing:
- Bank of America's capital hole as measured by the regulators is in the billions, said people close to the company, placing added pressure on management as the company prepares for a Wednesday shareholder meeting in Charlotte.
- It isn't clear how big a capital deficit Citigroup faces
That last one is just perfect. Kinda like figuring out how many holes it takes to fill the Albert Hall...
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