Bank bloodletting: What's to blame?

BAC posts less-than-expected loss
BAC posts less-than-expected loss   

Bank stocks took a major beating in midmorning trading Wednesday.

Though most financial institutions recently reported better-than-expected third-quarter results, a majority of bank stocks were in the red and financials was the single worst-performing sector so far on the day.

Bank of America, the second-largest U.S. bank, posted a narrower-than-expected loss of 1 cent versus average analyst expectation for 9 cents. Still, BofA saw its shares fall up to 4 percent after it reported its results Wednesday morning. On the company's conference call, there were numerous questions about interest rate sensitivity.

KeyBank, Regions Financial and JPMorgan Chase were among some of the hardest hit bank stocks in early trading Wednesday. Wells Fargo, with no non-U.S. exposure, fared the best of the major banks.

So what's going on? To some it could be a risk-on, risk-off scenario. In other words, investors are taking profits and minimizing risk as fears mount about everything from a lack of global economic growth to Ebola and rising geopolitical tensions around the world, among other worries.

Adam Jeffery | CNBC

Still, bank earnings have been relatively strong so far this earnings season.

To Jeffery Harte, a principal of Sandler O'Neill, it seems Citigroup has so far delivered the best third quarter, though he thinks BofA is in the running.

Read MoreBank of America posts smaller-than-expected loss

"JPMorgan had a solid quarter, but you know, I don't think it quite had the upside surprise of Citigroup and I don't specifically cover Wells Fargo, but their quarter was a little more challenged," he said Wednesday on "Squawk Box."

—CNBC's Kayla Tauche and Dominic Chu contributed to this report.