Bookmark Current Page
Edit Metric
|
||||||||||||||||||||
Details
|
||||||||||||||
| 
Edit
History
Bulls: Reasons To Buy
Bears: Reasons To Sell
Feeling Bearish?
Be the first to explain why this would make a poor investment
|
Top Contributors
|
Add your own Bulls Reason
The banking industry faces a challenging year in 2008 as many companies work through the weaker housing market and mortgage related issues.
In September 2007, the bank industry's earnings performance slipped for the first time in many quarters as the housing sector continued to weigh on the mortgage and investment banking businesses at many of the larger banks. The subprime mortgage fallout continued to affect the banking industry as it became difficult to value debt instruments backed by mortgages and caused a temporary credit freeze in some markets during the late summer.
More problems may arise in 2008 as rates on adjustable-rate mortgages made in 2005 and 2006 are scheduled to reset. Homeowners could potentially have a harder time making payments on these higher mortgages which may lead some to default. There is also a fear that the mortgage related problems may spill over into the credit card markets which would exacerbate the situation even further.
Banks make a profit by borrowing
Contents |
[edit] Investment Banks
Investment banks help public and private institutions to raise capital and provide advice on mergers and acquisitions.
[edit] Savings and Loan Banks
[edit] Investment Banks
|
[edit] Foreign Regional Banks
|
[edit] Money Center Banks
|
|
