The amount in loans that banks will need to write off will exceed levels seen during the Great Depression, according to a bank analyst’s report Monday.
The report helped send bank stocks and the overall market lower in early trading.
Mike Mayo of Calyon Securities gave the banking industry an “underweight” rating, citing “the ongoing consequences” of banks’ increased risk-taking.
“The seven deadly sins of banking include greedy loan growth, gluttony of real estate, lust for high yields, sloth-like risk management, pride of low capital, envy of exotic fees, and anger of regulators,” Mayo said in the report.
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