Chris Whalen: Little Banks Are Fine, But For The Bigger Banks Things Are Now Getting Worse

Chris Whalen of Institutional Risk Analytics spoke to Fox Business yesterday on the state of the banking industry and the mortgage market.

  • 0:50 Wilmington Trust selling enterprise for half of what it was worth; Bank directors worried about institutional failure.
  • 1:30 Wilmington Trust selling for fair value half of previous day because they agree.
  • 2:00 The government needs to restructure banks, you can’t prevent it. We’ve wasted two years, and haven’t restructured the top banks, but for Citi.
  • 2:50 White House and Treasury lacking vision and competency on this economy.
  • 3:18 Bank of America will need to be restructured; this isn’t about the documentation problem, this is because the cost of servicing the property.
  • 4:30 Distressed property buyers are cash buyers. They don’t have leverage. The leverage is the FDIC taking it over.
  • 5:05 Things are getting worse for the bigger banks. Post subsidies, they are now getting worse. Little banks are getting better.
  • 6:00 U.S. Bancorp is doing great.

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