Selloff Can't Tarnish Banks' Yields

"In general, I think we're in a period of questioning asset quality," says Bove. "When you start to question asset quality in a bank, it doesn't matter what the bank earns, people won't buy the stock."

Bove, who earlier this month issued a sell rating on the big brokerage stocks due to huge possible losses tied to bad debt, said he expects bank stocks to keep going down "until you start to see a shift in nonperforming assets," which rose at most banks in the latest quarter.

Likewise, Charles Lahr, a portfolio manager at Franklin Templeton(BEN Quote - Cramer on BEN - Stock Picks) who runs the Franklin mutual financial services fund, says investors should be on the sidelines for at least another 12 months.

His fund holds positions in few U.S. banks right now. Among those he owns are Citi and U.S. Bancorp(USB Quote - Cramer on USB - Stock Picks), a Minneapolis-based regional bank that yields 5.1% after a recent selloff.

"All of the large banks in the U.S. have exposure in one way or other to the securitization markets ... and ultimately you're seeing significant risk aversion after a very benign time," Lahr says.

"For the U.S. [banks], this is a time to be looking," he says, not buying. "We're not really at trough valuations yet."