What Are They Waiting For

The large regional banks like Regions Financial and Suntrust have been on fire, hitting new 52 weeks highs. For the most part the large regional banks have not yet repaid the TARP. After PNC raised capital a few weeks ago I expected a flood of large regional offerings but there has been nothing as of yet.

If there ever was a time to raise capital this is it and it is difficult for me to understand what these banks are waiting for. I have heard explanations that the regional banks are in such bad shape that they are afraid or can't exit TARP.

I expect that next week we might see a few offerings. The reason I am focused on this is because I watch supply and demand of stocks. A heavy supply of new issuance would be a negative for the overall market and the regional banks and financials in particular.


Anonymous said...

They're probably not raising because their stock price is too low.

Tsachy Mishal said...