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Back To The Future For The U.S. Banking System? Jan 10
Standard & Poors, Jan 2010
Abstract
The financial crisis of the past 18 months has affected few industries more than it has the U.S. banking industry. Even as economic conditions improve, Standard & Poor's Ratings Services thinks it's unlikely that banks will resume the practices and policies whose apparent failure forced the government to shore up the U.S. banking system in 2008 and 2009. Instead, in our view, banks will likely revert to a more conservative strategy based on a 'loan-to-own' mindset versus the 'originate to distribute' approach that exposed the largest financial institutions to the downside of aggressive underwriting and excessive leverage. (Listen to the related podcast titled, 'For The U.S. Banking System, Is It Back To The Future?', dated Jan. 27, 2010.) In fact,...
Companies mentioned in this report are: Bank of America Corp.,Fannie Mae,Citigroup Inc.,Freddie Mac
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues.
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