TheStreet Search RSS Feed: Shanthi Venkataraman

JPMorgan Reveals $2 Billion Derivatives Loss (Update 1)

Thu, 10 May 2012 17:03:49 EDT

Updated with comments from CEO Jamie Dimon

NEW YORK (TheStreet) -- JPMorgan Chase has suffered "significant" mark-to-market losses in its synthetic credit portfolio since the end of the first quarter, the bank revealed after the bell on Thursday.

In an highly unusual, unscheduled conference call, CEO Jamie Dimon revealed that the bank's Chief Investment Office has suffered a trading loss of $2 billion in its synthetic credit portfolio, offset by a $1 billion securities gain, as a strategy to re-hedge its portfolio backfired. ...

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Morgan Stanley May Avoid Big Downgrade Pain: Analyst

Thu, 10 May 2012 13:08:14 EDT

NEW YORK (TheStreet) --Morgan Stanley may see a less severe downgrade from Moody's than what the market currently anticipates, presenting a short-term, catalyst-driven opportunity for the stock, according to Wells Fargo Securities analyst Matthew Burnell.

Wall Street is bracing for a multi-notch downgrade of investment banks by the rating agency, expected to be announced sometime in June. In February, Moody's said it was reviewing its ratings of global banks including Morgan Stanley, Goldman Sachs, JPMorgan Chase, Citigroup and Bank of America in the context of their significant capital markets operations.

A downgrade could result in banks having to post more collateral to their counterparties, increasing their cost of funding. Lower rated banks also face the threat of losing clients in their derivatives trading operations because of their higher risk profile. ...

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Banks Stocks Remain Under Dark Cloud

Wed, 02 May 2012 14:04:15 EDT

NEW YORK (TheStreet) --With the bank earnings season complete, investors now await fresh catalysts for the sector. There are plenty on the horizon, though not all of them are positive for bank stocks.

In a report Wednesday, Deutsche Bank analysts identified several catalysts for the industry and for specific stocks as well.

One looming threat for the industry in the immediate term is the potential downgrade of Moody's, which could cost Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase and Morgan Stanley as much as $20 billion. ...

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Big Bank Failures Need Punishment: Fed's Fisher

Tue, 01 May 2012 12:49:12 EDT

NEW YORK (TheStreet) -- Dallas Federal Reserve President Richard Fisher -- a longtime critic of "Too-Big-To-Fail banks" and ultra-loose monetary policy-- says banks that require taxpayer assistance in the future will have to face harsh, non-negotiable consequences.

In a presentation building his case for breaking up the big banks on Tuesday, Fisher said taxpayer aid will be provided to banks with strings attached, such as requiring the removal of the CEO and top executive team, replacement of the board of directors and making all employment/compensation and bonus contracts "null and void."

He also said the top management team should be made to return any bonus compensation paid out in the two years prior to the bailout. ...

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Biggest Bank IPO of 2012 Ready to Hit Market

Mon, 30 Apr 2012 15:54:25 EDT

NEW YORK (TheStreet) -- Jacksonville, Florida-based EverBank Financial will sell about 25.2 million shares for between $12 and $14 in the largest bank initial public offering in 2012, according to a regulatory filing issued Monday.

At the upper end of the price range, the lender will raise more than $350 million and will command a market cap of over $1.5 billion. Of the 25 million shares being offered, 5.9 million constitutes an offer for sale by a clutch of private equity firms including Sageview Partners and TPG Capital.

The proceeds of the offer, excluding the sale by the existing stockholders, will go towards "general corporate purposes," that could fund organic growth opportunities as well as acquisitions. Earlier this year, the bank acquired the warehouse finance division of MetLife. ...

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Jobs Report Looms in Busy Coming Week

Fri, 27 Apr 2012 18:12:29 EDT

NEW YORK (TheStreet) -- With most of the blue-chip earnings reports out of the way, Wall Street's attention will swing back to the macro headlines in the coming week, headlined by the all-important April jobs report on Friday.

Stocks are coming off a positive weekly performance, buoyed by blockbuster earnings reports from Apple and Amazon and better-than-expected housing and consumer sentiment data.

Concerns about Spain's intensifying debt crisis were set aside, if only temporarily. ...

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JPMorgan: Apple of the Banking Sector

Thu, 26 Apr 2012 11:17:54 EDT

NEW YORK (TheStreet) -- Stifel Nicolaus analyst Chris Mutascio simply has no explanation for why JPMorgan Chase's shares are so cheap even as its shares continue to climb.

The stock was already attractively valued relative to the sector prior to earnings. Now, despite a strong earnings beat, the stock has only become cheaper, the analyst noted in a report Thursday.

JPMorgan shares trade at 7.7 times its 2013 earnings per share compared to the median price-earnings multiple of 9.6 the large-cap banks under Stifel's coverage. Prior to earnings, it traded at 8.6 times its expected 2013 earnings, compared to the median multiple of 9.9 of the group, so the discount has actually widened. ...

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Divided Fed Presents United Front

Wed, 25 Apr 2012 16:55:36 EDT

NEW YORK (TheStreet) -- The Federal Reserve sent a mixed message to the markets on Wednesday, revealing a more hawkish view of the economy, yet continuing to show a bias towards a highly accommodative monetary policy.

In its monthly policy statement , the Fed stood pat on interest rates and said it continues to expect the economy to grow at a moderate pace in the coming quarters and then pick up gradually. It also noted a rise in inflation, but stuck to its assessment that long-term inflation expectations were stable.

The Fed's economic projections, however, did have more pronounced differences to its earlier estimates. The central bank raised its forecast for GDP growth in 2012 to a range of 2.4-to-2.9%, up from its January estimate of 2.2-to-2.7%. ...

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Bank Stocks Cool Off for the Summer

Tue, 24 Apr 2012 15:06:55 EDT

NEW YORK (TheStreet) -- After a roaring start to the year, bank stocks are losing steam, underperforming the broader markets in the second quarter so far, despite a mostly positive earnings season.

The KBW Bank Index has slipped 2.9% since April 13, which marked the beginning of the bank earnings season, while the S&P 500 has lost about 1.5%.

Bank of America, which led the market rally in the first quarter has shed 17% in the past month alone. Citigroup, which also benefited from the "risk-on" rally in the early part of the year has shed about 10%. ...

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Obama Mortgage Policy Key to Election Narrative (Update 1)

Tue, 10 Apr 2012 12:38:49 EDT

Updated from 6:19 a.m. ET to add Federal Housing Finance Agency's analysis on principal reductions.)

NEW YORK (TheStreet) -- Housing has been among the top priorities for the Obama administration heading into the election year, with the government announcing a slew of measures aimed at providing relief to troubled borrowers in the past few months.

Many of the recent proposals are just tweaks to existing programs and the jury is still out on whether they will provide enough relief to borrowers to prevent them from defaulting and losing their home to foreclosure. ...

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JPMorgan's Dimon Likes Buybacks, Just Not Now

Wed, 04 Apr 2012 17:26:15 EDT

NEW YORK (TheStreet) -- JPMorgan Chase may not end up buying back too much stock this year, if the current strength in the stock persists.

In his annual letter to shareholders, CEO Jamie Dimon said the bank's appetite for buying back stock at current levels of around $45 is "not as great", as shares now trade well above tangible book value per share.

"If you like our businesses, buying back stock at tangible book value is a very good deal. So you can assume that we are a buyer in size around tangible book value," Dimon wrote. "Unfortunately, we were restricted from buying back more stock when it was cheap - below tangible book value - and we did not get permission to buy back stock until it was selling at $45 a share." ...

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AIG Has 50% Upside: Bernstein

Wed, 04 Apr 2012 14:05:35 EDT

NEW YORK (TheStreet) -- Shares of AIG were up nearly 4% on Friday, bucking broad market weakness, after Bernstein analyst Josh Stirling upgraded the stock to outperform and suggested that the stock may have a 50% upside in a "risk on" market.

The recommendation appears to hinge on the improving market and a continued appetite for financial stocks, which would enable AIG to sell non-core assets and use the proceeds to buy back the Treasury's stake, allowing the government to exit with a "victory lap" before the elections.

The government still owns a 70% stake in AIG, which has served as a major technical overhang for the stock. Investors have been reluctant to build positions in the stock ahead of a big sale by the government for fear that it will pressure prices. ...

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Big Bank Break-Up is Anti-American: Bove

Mon, 02 Apr 2012 15:51:51 EDT

NEW YORK (TheStreet) -- Talk of breaking up the big banks is resurfacing again, but Rochdale Securities analyst Richard Bove thinks doing so will be a major threat to the country's financial sovereignty.

In fact, the analyst makes a case for making big banks bigger. "The United States needs much bigger banks to protect its position in the global financial system," Bove argued in a note on Monday.

Earlier this morning, KBW published a report noting that bank break-ups might be inevitable. "At some point in the future, we would expect the current cycle to include public debate on the reduction in financial services and cuts in subsidies, particularly to Fannie Mae and Freddie Mac. We believe that the historical analysis suggests that investors should be prepared for the possible eventual break-up of the largest financials, including Bank of America, Citigroup and JPMorgan," the report said. ...

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Global Payments' Shares Languish After Breach, Earnings

Mon, 02 Apr 2012 10:31:00 EDT

NEW YORK (TheStreet) -- Shares of Global Payments opened 3% lower on Monday after it said that an "unauthorized access" into its processing system had exposed 1.5 million card accounts.

That follows a 9% decline on Friday, when news of the breach was first reported.

The card payments processor said the hackers accessed so called "Track-2" data but cardholder names, addresses and social security numbers were not obtained by the criminals. It also said the incident was confined to North America. ...

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Mastercard, Visa Warn of Security Breach (Update 1)

Fri, 30 Mar 2012 14:36:35 EDT

Article updated with Visa statement, analyst commentary, share prices.

NEW YORK (TheStreet) -- Mastercard and Visa said on Friday that they are investigating a possible account data breach at a third party.

Law enforcement agencies have been notified and an independent data security organization is currently conducting a "forensic review" of the incident, Mastercard said. ...

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