With Some Banks, Time To Take Profits: Analyst

A new panel commissioned by the Obama administration is going to start looking this month at how the banking system came to near collapse last Fall. Questions remain over how to make the financial system safer and whether investors should be looking at banks as an investment opportunity.

David Trone, a securities industry analyst at Fox-Pitt Kelton and Matt McCormick, a banking analyst at Bahl & Gaynor Investment Counsel, gave CNBC their take Tuesday on the financial industry.

"There are some of them [banks] that have gone too far too fast and it's time to take some profits," says McCormick. "With AIG CITI, Fannie, Freddie and Lehman, some are up over 200 percent. I think it's worthy of moving some assets to the sidelines. I would look to higher quality names and look to those that pay a good dividend yield in this space."

"We're pretty neutral on the banks," said Trone. "We're actually quite negative on the regionals because commercial loan quality continues to get worse."

"I think there's no political backing to keep bailing out financial entities right now" said McCormick. "If you want to buy in banks, do your homework and find names that don't have as much exposure to commercial real estate and credit cards. Avoid some of these TARP entities."

Recommendations:

McCormick likes:

Northern Trust

Bank of Nova Scotia

T.Rowe Price

Trone likes:

Wells Fargo

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CNBC Slideshows:

The World's Safest Banks

Bank Failures in 2008

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CNBC's Companies in the News:

GE

Apple

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Disclosures:

McCormick's firm owns Northern Trust, Bank of Nova Scotia and T. Rowe Price. Disclosure information was not available for David Trone.

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