The Financial Times reported that Morgan Stanley purchased 15 loans worth £430 million loan along Australia's Gold Coast from Lloyds Banking Group PLC (LYG), while Goldman Sachs purchased a £600 million portfolio of loans in New Zealand, also from Lloyds.
Goldman's shares rose 1% to close at $88.75.
The broad indexes weakened late in the session, but the KBW Bank Index (I:BKX) rose 1% to close at 34.90, as bank stock investors shrugged off another poor showing from the Italian Treasury, as the average yield on Italy's auction of ¿8 billion in 6-month bills climbed to 6.504%, according to Bloomberg. Meanwhile there was a slight sell-off in U.S. 10-year paper, with the market yield up to 1.96% at 1PM.Meanwhile, the average yield on 2-year Italian paper was 7.82%, which exceeded the yield on Italy's 10-year bonds by roughly 50 basis points, in a classic sign of a distressed market for sovereign debt. Large banks seeing 2% gains on Friday included People's United Financial (PBCT - Get Report), which closed at %11.82, and Wells Fargo (WFC - Get Report), closing at $11.83. Wells Fargo is among the large mortgage servicers that could get a break from the Federal Housing Administration, as part of the broad settlement between federal regulators and state attorneys general. The American Banker reported that the FHA may release the servicers from liability related to their loss mitigation efforts on FHA-insured loans. Major U.S. banks seeing shares rise 1% on Friday included Bank of America (BAC - Get Report), closing at $5.17; BB&T (BBT - Get Report), at $21.18; Citigroup (C - Get Report), at $23.68; and U.S. Bancorp (USB - Get Report), which closed at $24.03.
Philip van Doorn. To follow the writer on Twitter, go to http://twitter.com/PhilipvanDoorn.