April 2009

Word on Wall Street is that Bank of America and Citigroup have failed the Treasury's stress tests, and to bolster their capital, the government will convert its combined $95 bn preferred stakes in the two banking giants into common shares with voting rights. That stake would swamp their combined $76 bn market capitalization, though the swap exchange could have US taxpayers owning less than ... read more

Securities and Exchange Commission chairman Mary Schapiro said it is "troubling" that the Securities and Exchange Commission "might have been deliberately excluded" in the Treasury Department's negotiations with Bank of America. And Schapiro noted that "obligations to disclose information about losses...rests solely on the companies, not with the Treasury secretary or Federal Reserve ... read more

In the face of a shareholder revolt over massive losses at Merrill Lynch, and a bonus controversy that has ignited voter outrage, shareholder lawsuits and regulatory probes, Bank of America's chief executive Kenneth Lewis has offered a compelling narrative in his defense to shareholders, a growing number of whom want him sacked. The narrative: That Lewis and his team of executives did not ... read more

When it comes to bank earnings, so far so good. Now it's about the Treasury stress tests of the 19 banks. And that ain't so good. The markets got a look at profit figures and expectations from a number of big banks and companies this past week. Wells Fargo says it expects a first quarter profit, JPMorgan Chase as usual didn't disappoint with decent earnings, and the beleaguered ... read more

Goldman Sachs cleverly used quirks in financial reporting to help power interest in a new $5 bn common stock offering that the blue chip firm announced along with its first quarter earnings release. How exactly did Goldman turbocharge its first quarter profits with these quirks, and did it do so to ignite investor clamor for its new common stock offering in what may be a suckers' rally, ... read more