Oppenheimer's Meredith Whitney Still Negative on Financials
Oppenheimer analyst Meredith Whitney discussed issues in banking today in a interview with CNBC's Maria Bartiromo this afternoon.
Here are some highlights from the interview:
- Whitney said asset values on the books of many banks are "aspirational" and will need to come down.
- Whitney notes that the equity raised by various financial companies, like Merrill Lynch (NYSE: MER), Citi (NYSE: C) and others, is just "plugging holes" in balance sheets, not funding growth.
- Whitney said recent moves by Merrill Lynch to sell CDO's at $0.22 on the dollar is a "move in the right direction", but it is "not out of the woods yet."
- Whitney sees additional capital raises from Citi (NYSE: C).
- Whitney questions why some financial companies are continuing to pay dividends, while raising dilutive capital. She expects Citi (NYSE: C) to cut its dividend further, maybe to somewhere in the $0.05 range like Wachovia (NYSE: WB).
- When Maria asked Meredith if Lehman Brothers (NYSE: LEH) can survive the credit meltdown, Meredith paused for a time then said, "I don't know."
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