U.S. Banks Deemed Riskier Than European and Chinese by FSB - (C) (BAC) (WFC) (MS) (BCS) (HSBC)
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The Financial Stability Board (FSB) released it's latest ratings this morning and concluded, with the agreement of the United States regulators, that the United States banks constitute the biggest threat to the global financial system. The Board raised the risk rating on three U.S. banks: including Citigroup (NYSE: C), Bank of America (NYSE: BAC) and Wells Fargo (NYSE: WFC), while lowering ratings on Morgan Stanley (NYSE: MS) and 2 British banks: Barclays (NYSE: BCS) and HSBC (NYSE: HSBC).
Rafferty Capital Markets analyst Richard Bove commented, "In taking this action the FSB, with the concurrence of the United States indicated its severe difference of opinion with the judgments being made in the market place. In recent months, the problems at Deutschebank and other European banks dominated trading in financial institutions. Similarly, the U.S. banks traded up as examples of the comparative safety of these institutions."
Bove continued, "The FSB, with the concurrence of the U.S. bank regulators, says no, no, no it is the Americans that are at risk not the Europeans. In fact, Mark Carney of the Bank of England and the FSB Chairman had the risk rating on two British banks reduced while he raised the rating on three U.S. banks. The Chinese, who are currently dealing with the biggest real estate loan problem in their histories, are viewed as the safest of all."
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Related EntitiesCiti, Morgan Stanley, Bank of America, Barclays, Richard Bove, HSBC, Wells Fargo
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