Skip navigation
Watchlist Sponsored By :


Current DateTime: 07:46:45 10 Feb 2012
LinksList Documentid: 23452764
Expiration DateTime: 2/10/2012 7:48:24 PM

Current DateTime: 07:46:47 10 Feb 2012
LinksList Documentid: 23452000
Expiration DateTime: 2/10/2012 7:48:40 PM

Current DateTime: 07:46:47 10 Feb 2012
LinksList Documentid: 24355697
  • The World's Best Beers

      Craft brewers account for only about five percent of the US market, but that may be changing.

  • Fashion Stocks Traders Love

      Over the past couple of months, the “Fast Money” traders weighed in on companies that stood out.

  • Best in Show

      Who is the top dog at the Westminster Kennel Club Dog Show

MOST SHARED


Current DateTime: 07:46:47 10 Feb 2012
LinksList Documentid: 31330905
Expiration DateTime: 2/10/2012 7:48:45 PM

MOST POPULAR


Current DateTime: 07:46:47 10 Feb 2012
LinksList Documentid: 35819650
    • Road Warriors

        All the gadgets and gear a savvy frequent traveler needs to navigate the global economy.

HOT ON FACEBOOK

Oppenheimer’s Whitney Sees Credit Crisis Well into '09

Published: Tuesday, 20 May 2008 | 7:55 AM ET
Text Size
By: Reuters

AP

The credit crisis will likely extend well into the next year and beyond, resulting in three years of multi-billion dollar revenue reversals, according to a prominent U.S. banking analyst, Meredith Whitney, who also slashed her earnings outlook for four Wall Street investment banks.

By the end of 2009, over $170 billion of reserve builds will flow through bank earnings on top of "business as usual" loan loss provisions, said the Oppenheimer & Co analyst, who in October correctly predicted that Citigroup would cut its dividend and go on a capital-raising spree.

"Either in the form of write-downs or reserve builds, we believe the effect is the same: revenue reversal from years worth of inherently flawed underwriting," Whitney said.

The analyst lowered her 2008 outlook for JPMorgan Chase, Citigroup, Bank of America and Wachovia. She, however, cut her second-quarter earnings view for Bank of America and JPMorgan while raising it by a cent each for Citigroup and Wachovia.

"When most talk about the shut down in the securitization markets, they more often focus on declining profits for the investment banks..., we argue the far more important consequence of the buyers strike in the securitization market is the impact on overall consumer liquidity, consumer spending and ultimately on consumer defaults," Whitney said.

She estimated that over $3 trillion of liquidity would have been extracted from the capital markets by the year-end, due to the considerable stress on consumer liquidity from the "buyers strike" in the securitization market.

"Over time, the bank lending model will reclaim lost lending market share over the mortgage market, but bank balance sheets simply do not have the capacity to provide the liquidity lost by the shut down in the securitization market," she said.

Whitney rates Citigroup "underperform." She has a "perform" rating on Bank of America, JPMorgan Chase and Wachovia.

Shares of JPMorgan Chase [JPM  Loading...      ()   ] closed at $45.99 Monday on the New York Stock Exchange, while shares of Citigroup [C  Loading...      ()   ] closed at $22.99.

Bank of America [BAC  Loading...      ()   ] shares closed $36.10 Monday, while Wachovia [WB  Loading...      ()   ] shares closed at $27.36.

Copyright 2011 Thomson Reuters. Click for restrictions.

CNBC HIGHLIGHTS

  • Alternative Investing: A CNBC Special Report
  • Marketing clichés aside, sometimes diamonds are for investing.
  • Nordstrom
  • The ‘Fast Money’ traders weigh in on fashion related stocks from apparel to footwear.
  • Las Vegas
  • This list of the 10 most active cities for speed traps was compiled by Trapster.com. See if your town is there.
  • This Valentine’s Day should prove a love fest for restaurants, as many couples will be dining out.
  • Airdale Terrier
  • Here’s a look at Westminster Kennel Club’s most successful breeds—and how much they cost.
  • Jennifer Aniston and Justin Theroux home
  • What kind of homes do celebrity couples share? Here’s our updated list. Take a look.


Current DateTime: 09:37:11 10 Feb 2012
LinksList Documentid: 29778428

Current DateTime: 02:33:41 10 Feb 2012
LinksList Documentid: 29779196

Current DateTime: 11:35:14 10 Feb 2012
LinksList Documentid: 29779197

Current DateTime: 02:56:31 10 Feb 2012
LinksList Documentid: 29779199
CNBCCNBC
About CNBC  |  Site Map  |  Video Reprints   |  Advertise  |  Help  |  Contact
Privacy Policy  |     |  Terms of Service  |  Independent Programming Report
  Data is a real-time snapshot  *Data is delayed at least 15 minutes
Global Business and Financial News, Stock Quotes, and Market Data and Analysis

© 2012 CNBC LLC.  All Rights Reserved.
A Division of NBCUniversal
Thomson ReutersThomson Reuters