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10 Bank Stock 2011 Winners and Losers

NEW YORK ( TheStreet) -- For most of 2011, bank stock investors have asked themselves one question repeatedly as the European crisis deepened. Is this 2008 all over again?

While industry analysts and Wall Street chieftains have made passionate arguments about how the fundamentals of the U.S. banking system has significantly improved since the financial crisis by almost every metric, jittery investors have not been willing to stick around to find out if that is true.

Bank stocks have suffered their worst decline since 2008 as investors shoot first and ask questions later, with the SPDR Financial Select Sector (XLF) shedding nearly 25% year to date. The biggest banks have led the plunge, with the KBW Bank Index, a basket of 24 of the largest banks, declining 32% year-to-date.

Concerns over exposure to Europe, dismal capital market revenues, a harsher regulatory environment and an unprecedented downgrade of U.S. debt in August assailed the stocks of Bank of America (BAC - Get Report), Morgan Stanley (MS) and Citigroup (C - Get Report) which have shed 60%, 47% and 43% respectively in 2011.

JPMorgan Chase (JPM - Get Report) and Wells Fargo (WFC - Get Report) declined by a lesser extent, falling by 20% and 29% respectively.

Small-cap regional banks fared better, as did credit card companies and mortgage servicers.

All data is as of Nov. 29.

Bank stocks now trade at such deep discounts to historical valuations- many bluechip names trade below their book value- that few sell-side analysts can bring themselves to say ⿿sell,⿝ despite the cloudy macroeconomic outlook .

>> Why Bank Stock Calls Bombed in 2008: Bove

They maintain that U.S. banks have improved capital levels and liquidity, have fewer problem loans on their books and can navigate a sluggish economic environment by focusing on cost-cutting.

But investor confidence in banks never fully returned in the aftermath of the 2008 crisis and negative headlines emanating out of Europe and the U.S. have not helped.

Investors remain nervous about banks "true" exposure to counterparties in Europe following the failure of MF Global (MFGLQ.PK). Banks have tried to improve their disclosure about their exposure to Europe, but investors question the effectiveness of the hedges they have in place and the quality of the disclosures have varied widely.

Rating agencies have downgraded the debt ratings of banks amid concerns over the sovereign debt crisis in Europe and America's own debt problems.

The anti-Wall Street rhetoric has grown louder with the occupy wall street movement, making it less likely that banks will be able to win their battle with Congress over regulations as we head into the Presidential elections.

Meanwhile, banks have also been unsuccessful so far in finding offsets for lost revenues, with their proposals to impose fees on debit card purchases backfiring.

Here are some of the biggest winners and losers in the financial sector year to date, starting with the losers.

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