Regional banks took a bath Monday, led in part by
For months rumors have swirled that National City would be taken over, yet none of the would-be suitors ever walked all the way to the altar. On Monday,
for a time midday and the bank to issued a statement that all was well and there was no run on the bank. The stock sank to a new low of $2.99. Recently, shares were down 71 cents, or 15.4%, to $3.74. They've traded between $4.24 and $33.54 over the last 52 weeks.
Nat City's fall follows the weekend demise of
( IMB). The Pasadena, Calif.-based bank was
, marking the second largest bank failure in U.S. history. The Office for Thrift Supervision, IndyMac's regulator, said IndyMac "is unlikely to be able to meet continued depositors' demands" and thus was "in an unsafe and unsound condition" and turned the bank over to Federal Deposit Insurance Corp. The bank debt was downgraded by Fitch Ratings on Monday to a default rating while the stock imploded 48% to 14 cents. Over the past 52 weeks, the stock has traded between 25 cents and $29.74.
Another bank getting slammed on Monday was
which reported its
, revealing a 25% drop in net income. The bank dropped off 18.8% to $56.58 after recording huge increases in non-performing loans and taking in considerably more assets due to foreclosures.
Other banks that were getting hit hard included
, sliding 31.5% to $3.39. A Lehman Brothers analyst suggested that WaMu could see $26 billion in total losses from items on its balance sheet.
tumbled 21.5% to $20.16 after
downgraded Zion to sell and cut its price target on the bank.
( FRE) continued to sell off after the Treasury over the weekend unveiled a
plan to save the mortgage lenders
. Billions of federal dollars will be injected into the government-sponsored entities through investments and loans. Common stockholders increasingly feared that their shares would become worthless and in heavy volume took the stocks down again. Fannie was slowly gaining ground in the afternoon and was up 60 cents to trade at $10.82, while Freddie dropped 20 cents to $7.56.
( LEH) was dragged down another 4% to $13.84 after
The Wall Street Journal
reported the investment bank was considering strategies to stop the bleeding in the stock. Lehman is reportedly mulling several options, including a strategic alliance with a partner, selling assets or a potential stock buyback. Over the weekend, officials from the
Securities and Exchange Commission
held talks with Lehman executives to discuss the firm's woes, the report said.
Brokerages in general, crumbled with the banks, with
( MER) giving back 5% to trade at $26.23 and
falling 5.6% to $24.42.
was another big loser for the day as the stock dwindled to $2.46, losing 11.7% or 32 cents on heavy trading. Rumors varied between a takeover and bankruptcy.
NYSE Financial Sector
index declined 148.06 to 5,740.87.
One of the few bright spots in the financial sector was
, which edged up $1.16, or 0.5%, to $258.51 after reporting that consumers spending grew as people began putting the economic stimulus checks to work.