By John Galt
June 13, 2011
This story from the Wall Street Journal this morning:
Bank Probes Its Executives
appears to indicate that the insiders who did not sell after the 2009 crash and burn may well regret their inaction. Region’s Financial is facing a slew of major obstacles including almost $4 billion in NPL’s (Non-performing loans), a real estate portfolio in Florida which is deteriorating in both credit quality and price, and not receiving regulatory permission from the Treasury Department to repay the $3.5 billion outstanding from the Troubled Asset Relief Program (TARP). Thus when the 12th largest bank in the U.S. has a story like pop on to the front page of America’s largest financial newspaper the question of comparison to the now defunct Indymac has to be asked, especially when reviewing the performance of their stock over the last year during the so-called “recovery” in the economy.
If the stock shatters $5.20 per share there is nothing but air to support this bank or prevent it from becoming a penny stock. Considering the horrid condition of the residential and commercial real estate market in the states where Regions has cast their lot, the support in the chart above looks mighty thin.
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