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KC native
08-28-2009, 02:16 PM
Can't believe no one noticed this. This is the most important piece of news for the day (and maybe the last month) and is a perfect display of moral hazard. Give money with no strings and this is the type of shit you receive..


http://www.bloomberg.com/apps/news?pid=20601087&sid=a_XpcU5pY0f4#
Leverage Rising on Wall Street at Fastest Pace Since ‘07 Freeze
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By Kristen Haunss and Jody Shenn

Aug. 28 (Bloomberg) -- Banks are increasing lending to buyers of high-yield company loans and mortgage bonds at what may be the fastest pace since the credit-market debacle began in 2007.

Credit Suisse Group AG and Scotia Capital, a unit of Canada’s third-largest bank, said they’re offering credit to investors who want to purchase loans. SunTrust Banks Inc., which left the business last year, is “reaching out to clients” to provide financing, said Michael McCoy, a spokesman for the Atlanta-based bank. JPMorgan Chase & Co. and Citigroup Inc. are doing the same for loans and mortgage-backed securities, said people familiar with the situation.

“I am surprised by how quickly the market has become receptive to leverage again,” said Bob Franz, the co-head of syndicated loans in New York at Credit Suisse. The Swiss bank has seen increasing investor demand for financing to buy loans in the past two months, he said.

Federal Reserve data show the 18 primary dealers required to bid at Treasury auctions held $27.6 billion of securities as collateral for financings lasting more than one day as of Aug. 12, up 75 percent from May 6.

The increase suggests money is being used for riskier home- loan, corporate and asset-backed securities because it excludes Treasuries, agency debt and mortgage bonds guaranteed by Washington-based Fannie Mae and Freddie Mac of McLean, Virginia or Ginnie Mae in Washington. Broader data on loans for investments isn’t available.

Before Bear

The increase over that 14-week stretch is the biggest since the period that ended April 2007, three months before two Bear Stearns Cos. hedge funds failed because of leveraged investments. The world’s largest financial institutions have taken $1.6 trillion in writedowns and losses since the start of 2007, helping to trigger the worst financial calamity since the 1930s, according to data compiled by Bloomberg.

Lending to purchase loans rated below investment grade and mortgage bonds is part of this year’s recovery in credit markets. Companies sold $889 billion of corporate bonds in the U.S. this year, a record pace, Bloomberg data show. The Standard & Poor’s 500 Index rose 52 percent since March 9, the best rally since the Great Depression.

Some areas of the credit market haven’t returned to the levels from before the collapse in real estate. Lenders are also requiring more collateral for loans.

Drop in Loans

Banks arranged $61.8 billion of leveraged, or high-yield, loans this year, a 74 percent decline from the same period in 2008, and 91 percent lower than two years ago, Bloomberg data show. Leveraged loans are rated below Baa3 by Moody’s Investors Service and BBB- by S&P of New York. No bonds containing new mortgages have been sold this year, except those with government backing, according to industry newsletter Inside MBS & ABS of Bethesda, Maryland.

The Fed data on loans by primary dealers is down from $113.8 billion in 2007. The data reflects so-called reverse- repurchase financing, securities-lending agreements and other arrangements.

Financing purchases of assets is filling cracks left by the government, whose lending programs to end the recession didn’t address some of the riskiest parts of the consumer and corporate debt markets.

The Fed’s $1 trillion Term Asset-Backed-Securities Loan Facility can’t be used to buy residential mortgage bonds and leveraged loans. The Treasury Department’s $40 billion Public- Private Investment Program excludes the loans and mortgage bonds that are repackaged into new securities.

‘Political Pressure’

“There is a lot of political pressure on banks to lend and this is one form,” said Ratul Roy, head of structured credit strategy at Citigroup in New York.

The Fed and government programs prompted sales of securities backed by auto loans, credit cards, equipment leases and auto-dealership debt.

Yields on top-ranked debt backed by auto loans and credit cards have fallen by as much as 2 percentage points relative to benchmark rates. The yield premium has shrunk to less than 1 percentage point since TALF began in March, according to Charlotte, North Carolina-based Bank of America Corp. data. The average interest rate on loans for new cars declined to 3.88 percent in June, from 8.23 percent in January, Fed data show.

The Fed is also buying as much as $1.25 trillion of so- called agency mortgage bonds. Fixed-rate, 30-year mortgages to borrowers with good credit who put money down are 5.29 percent, according to North Palm Beach, Florida-based Bankrate.com, or 1.85 percentage points more than 10-year Treasuries. The gap was 3.05 percentage points at the end of 2008.

Leveraged-Loan Prices

The increase in bank financing tracks a rebound in demand for securities and assets.

Prices for leveraged loans tumbled to a record low 59.2 cents on the dollar on average Dec. 17, before rebounding to 83.5 cents on Aug. 27, according to the S&P/LSTA U.S. Leveraged Loan 100 Index.

As much as 5 cents of the gains are partly attributable to “leverage coming back into the system,” according to Franz at Zurich-based Credit Suisse.

The senior-most bonds backed by adjustable-rate Alt-A home loans, or those with little to no documentation of a borrower’s finances, have jumped to 52 cents, from a low of 35 cents in March, according to Barclays Plc in London. Top-rated commercial-mortgage securities soared to 90 cents on average, from 72 cents in February, Merrill Lynch & Co. index data show. Merrill is a unit of Bank of America.

Credit Losses

The risk now is that new credit leads to more losses at a time when consumer and corporate default rates are rising. Company defaults may increase to 12.2 percent worldwide in the fourth quarter, from 10.7 percent in July, according to new York-based Moody’s.

U.S. financial institutions probably will report more credit losses as commercial real estate falters through next year, James Wells III, the chief executive officer at SunTrust, Georgia’s biggest lender, said in an Aug. 24 speech to the Rotary Club of Atlanta.

“If you lever up an asset at these already elevated prices, and the underlying fundamentals, like termites, start to chew through the performance of the security, at some point it becomes unsustainable,” said Julian Mann, who helps oversee $5 billion in bonds as a vice president at First Pacific Advisors LLC in Los Angeles.

No Thanks

Chimera Investment Corp., the New York-based mortgage-debt investor that raised $1.5 billion by selling stock last quarter to buy devalued assets, hasn’t taken banks up on their loan offers in part because the company isn’t sure it would be able to continue “rolling” the financing when it matures, said Matthew Lambiase, the company’s CEO.

The lack of a “robust” market means lenders may have too much power to change terms, Lambiase said on a July 30 earnings conference call with investors and analysts.

Investments held with borrowed money by funds including Santa Fe, New Mexico-based Thornburg Mortgage Inc. and Peloton Partners LLP of London slammed the markets as retreating prices made banks wary about getting repaid.

That triggered margin calls, collateral seizures and obligations to unwind, fueling the downward spiral in credit markets. Thornburg, a 16-year-old home lender, filed for Chapter 11 bankruptcy protection in May. Peloton, a hedge-fund firm run by former Goldman Sachs Group Inc. partners, shut its $18 billion ABS Fund.

Money Down

Financing terms are more stringent than before credit markets seized up.

Investors seeking loans to buy non-agency home-loan bonds typically must put down 35 percent to 50 percent, according to four investors and bankers whose firms are using or providing the leverage and didn’t want to be named because the negotiations are private.

That compares to as little as 3 percent for top-rated mortgage bonds before the markets collapsed, according to Laurie Goodman, an analyst at Amherst Securities Group LP in New York. She was among Institutional Investor’s top-rated fixed-income analysts while at Zurich-based UBS AG from 2000 to 2008.

Banks are typically offering as much as $3 in financing for every $1 of equity investors in leveraged loans contribute, down from $6 to $7 before mid-2007, Barry Delman, a New York-based managing director of structured credit products at Scotia Capital, said in reference to so-called total return swaps. Scotia Capital is a unit of Bank of Nova Scotia in Toronto.

The swaps are a type of derivative where a bank passes on returns or losses from a pool of loans to an investor.

Citigroup, JPMorgan

The interest rate that investors are now being charged is usually between 2 percentage points and 2.75 percentage points more than the London interbank offered rate, according to Delman. Three-month Libor, or what banks charge each other for loans in dollars, was set at 0.36 percent yesterday, according to the British Bankers’ Association.

Derivatives are contracts whose values are tied to assets including stocks, bonds, commodities and currencies, or events such as changes in interest rates or the weather.

JPMorgan and Citigroup, the second- and third-largest U.S. banks by assets, are offering similar terms, according to investors. Tasha Pelio, a spokeswoman at JPMorgan, and Jeanette Volpi, a Citigroup spokeswoman, declined to comment. Both banks are based in New York.

“To the degree leverage coming back represents a normalization of the markets, it’s a good thing,” said Michael Youngblood, a former mortgage-bond analyst who last year co- founded hedge fund Five Bridges Advisors LLC in Bethesda, Maryland. “But the idea it should be part of any permanent residential-mortgage-securities portfolio strategy is unwise.”

To contact the reporters on this story: Kristen Haunss in New York at khaunss@bloomberg.net; Jody Shenn in New York at jshenn@bloomberg.net.
Last Updated: August 28, 2009 00:19 EDT

Demonpenz
08-28-2009, 02:18 PM
this comes on the heels of an important pro choice win for dems

petegz28
08-28-2009, 02:22 PM
this comes on the heels of an important pro choice win for dems

heh?

Taco John
08-28-2009, 02:26 PM
I'm suprised to see a Democrat making an argument about moral hazard. I didn't get the impression that Democrats cared much about such frivolity when government can wave a magic wand and cure all ills...

KC native
08-28-2009, 02:49 PM
I'm suprised to see a Democrat making an argument about moral hazard. I didn't get the impression that Democrats cared much about such frivolity when government can wave a magic wand and cure all ills...

I've been critical of their handling of the crisis as I was the Bush Administration's. Leverage is one of the main reasons for this crisis and here we are not even a year later setting ourselves up for a repeat of 2007.

FTR I'm not a Democrat. I think the two party system is one of our biggest problems in politics now. I would be fine if all political parties ceased to be.

Nightfyre
08-29-2009, 12:20 PM
The market has been leveraging for sometime as evidenced by the tightening ted spread. The worst part is, the market is so flush with liquidity that inflation is just arounf the corner and that fact is being ignored by our monetary policy gurus in the fed. Jmo, of course.
Posted via Mobile Device

memyselfI
08-29-2009, 04:58 PM
I need a dose of Stewie to help me with how we are to be screwed yet again...

Saul Good
08-29-2009, 05:34 PM
I need a dose of Stewie to help me with how we are to be screwed yet again...

You can bet that, whatever Stewie says, KCNative will tell him that he's wrong.

BucEyedPea
08-29-2009, 05:42 PM
You can bet that, whatever Stewie says, KCNative will tell him that he's wrong.

You bet, anyone who disagrees with him is ignorant of economics.

Saul Good
08-29-2009, 05:47 PM
You bet, anyone who disagrees with him is ignorant of economics.

Native is pushing thirty, has a negative net worth, and has the balls to claim that Stewie is a financial ignoramus. Hopefully some of the college kid know-it-alls are able to appreciate just a little piece of the irony in this. Maybe then they will realize just how big of a chasm there is between having theories and having experience.

***SPRAYER
08-29-2009, 05:55 PM
The market has been leveraging for sometime as evidenced by the tightening ted spread. The worst part is, the market is so flush with liquidity that inflation is just arounf the corner and that fact is being ignored by our monetary policy gurus in the fed. Jmo, of course.
Posted via Mobile Device

Yup. And also we still have two more waves of subprime mortgages to reset. The shit hasn't hit the fan yet--- but it will.

BucEyedPea
08-29-2009, 08:56 PM
Native is pushing thirty, has a negative net worth, and has the balls to claim that Stewie is a financial ignoramus. Hopefully some of the college kid know-it-alls are able to appreciate just a little piece of the irony in this. Maybe then they will realize just how big of a chasm there is between having theories and having experience.

Good point! Don't leave out that he works with the crooks for the crooks on Wall Street because he ceaselessly whitewashes their criminality using inflation to bail themselves out and hurtin' everyone else.
Crooks like to hang together. Obviously, I'm a lot harder on him than you even.

KC native
08-30-2009, 03:39 AM
Native is pushing thirty, has a negative net worth, and has the balls to claim that Stewie is a financial ignoramus. Hopefully some of the college kid know-it-alls are able to appreciate just a little piece of the irony in this. Maybe then they will realize just how big of a chasm there is between having theories and having experience.

LMAO I love reading DC when I'm drunk and up late (ad hominems out the ass). I have a negative net worth due to factors outside of my control. I did make it worse because of some of my actions but regardless of how I would have done as an undergraduate I would have been at a negative net worth for at least a decade because I'm a kid from the ghetto who had the nerve to go to a nice rich private school. This is even funnier considering I'm the definition of the American dream. I grew up in really shitty circumstances. I've been shot at, people have tried to stab me, and attempted robberies. Yet despite that shit I've managed to be a first generation college graduate. I've dealt with an absentee father and being the father figure for your little brothers when you are still a child yourself. Honestly I really don't give a shit if you fuckwads believe me or not.

What I think is really funnier is that you conservatives assume I'm at my earnings peak when I'm far from that. Doubt me if you will but I'm going to return to school very soon and will escalate my earnigns potential exponentially. Also, despite the markets losing 50% over their crash I lost no money in the accounts that I'm responsible for. The product I'm involved with now did lose some money but ultimately I'm not the person that makes the calls and due to some platform limitations a certain degree of losses could not be avoided.

As far as Stewie is concerned, there is a phenomena that is known as right for the wrong reasons (check out peter schiff for a pefrect example). Stewie has been right on the direction of the dollar in the past (or so I'm told) however anybody that was worth a shit saw a devaluation coming just due to the current account imbalance. Apart from that Stewie has failed to articulate his views and methods to achieve them, and despite him being right on the direction of the dollar he has failed to accurately represent his performance. If you want to put faith into a person that considers their subsequent purchases as part of their cost basis for their claimed return then you deserve to have your money stolen by wall street crooks.

In conclusion, you conservative fuckers on here can attack me all you want but it will not prevent me from showing you where you're wrong. I think it is extremely obvious how shallow your arguments are when you resort to attacking me while failing to cite where I have been wrong.

KC native
08-30-2009, 03:43 AM
Good point! Don't leave out that he works with the crooks for the crooks on Wall Street because he ceaselessly whitewashes their criminality using inflation to bail themselves out and hurtin' everyone else.
Crooks like to hang together. Obviously, I'm a lot harder on him than you even.

Even more richness from a **** that can't be honest enough to admit I'm not on ignore.

Leverage Rising on Wall... 08-29-2009 04:31 PM BucEyedPea Nah, just that no one likes to discuss things with you.

FTR I'm not employed by a firm that hasn't received any type of bailout funds. WE aren't publicly traded and have no shareholders to answer to other than employees and our board of directors. So go **** yourself if you think I'm part of the establishment.

KC native
08-30-2009, 03:43 AM
Yup. And also we still have two more waves of subprime mortgages to reset. The shit hasn't hit the fan yet--- but it will.

Is that any different from what I've been saying since I've joined here?

Saul Good
08-30-2009, 08:44 AM
LMAO I love reading DC when I'm drunk and up late (ad hominems out the ass). I have a negative net worth due to factors outside of my control. I did make it worse because of some of my actions but regardless of how I would have done as an undergraduate I would have been at a negative net worth for at least a decade because I'm a kid from the ghetto who had the nerve to go to a nice rich private school. This is even funnier considering I'm the definition of the American dream. I grew up in really shitty circumstances. I've been shot at, people have tried to stab me, and attempted robberies. Yet despite that shit I've managed to be a first generation college graduate. I've dealt with an absentee father and being the father figure for your little brothers when you are still a child yourself. Honestly I really don't give a shit if you ****wads believe me or not.

What I think is really funnier is that you conservatives assume I'm at my earnings peak when I'm far from that. Doubt me if you will but I'm going to return to school very soon and will escalate my earnigns potential exponentially. Also, despite the markets losing 50% over their crash I lost no money in the accounts that I'm responsible for. The product I'm involved with now did lose some money but ultimately I'm not the person that makes the calls and due to some platform limitations a certain degree of losses could not be avoided.

As far as Stewie is concerned, there is a phenomena that is known as right for the wrong reasons (check out peter schiff for a pefrect example). Stewie has been right on the direction of the dollar in the past (or so I'm told) however anybody that was worth a shit saw a devaluation coming just due to the current account imbalance. Apart from that Stewie has failed to articulate his views and methods to achieve them, and despite him being right on the direction of the dollar he has failed to accurately represent his performance. If you want to put faith into a person that considers their subsequent purchases as part of their cost basis for their claimed return then you deserve to have your money stolen by wall street crooks.

In conclusion, you conservative ****ers on here can attack me all you want but it will not prevent me from showing you where you're wrong. I think it is extremely obvious how shallow your arguments are when you resort to attacking me while failing to cite where I have been wrong.

You might want to read up on what "The American Dream" really is. I can't say for certain, but I believe that being a part of it and supporting a group that wants to annex a large portion of the United States and return it to Mexico are mutually exclusive.

I'll start valuing your opinion on financial matters right after I start taking tips from Claythan on how to meet women and racial sensitivity classes from SPRAYER.

***SPRAYER
08-30-2009, 08:49 AM
All the O-bots want to talk about the stock market (which is being manipulated) and not the double digit unemployment when it comes to the "recovering" economy.

Pioli Zombie
08-30-2009, 06:04 PM
All the O-bots want to talk about the stock market (which is being manipulated) and not the double digit unemployment when it comes to the "recovering" economy.
Don't you have a black church to set fire to or something?
Posted via Mobile Device

Saul Good
08-30-2009, 07:20 PM
Don't you have a black church to set fire to or something?
Posted via Mobile Device

Way to inject race into a conversation about increasing leverage on Wall Street. It had to be done. Kudos for having the courage to be the one to do it.

Calcountry
08-30-2009, 07:43 PM
Yup. And also we still have two more waves of subprime mortgages to reset. The shit hasn't sprayed through the fan yet--- but it will.FYP

BucEyedPea
08-31-2009, 07:39 AM
I love reading DC when I'm drunk and up late (ad hominems out the ass).
Payback's HELL isn't it?


In conclusion, you conservative ****ers on here can attack me all you want but it will not prevent me from showing you where you're wrong. I think it is extremely obvious how shallow your arguments are when you resort to attacking me while failing to cite where I have been wrong.

This....this is what we're paying back. You've got a lot of karma filled up here particularly when you came here starting with put downs.

Take a good look in the mirror, instead of wild projection being used as a defense mechanism.

Oh and you're still a crook. It's clear who's side your on. That's a fact.

KC native
08-31-2009, 11:12 AM
You might want to read up on what "The American Dream" really is. I can't say for certain, but I believe that being a part of it and supporting a group that wants to annex a large portion of the United States and return it to Mexico are mutually exclusive.

I'll start valuing your opinion on financial matters right after I start taking tips from Claythan on how to meet women and racial sensitivity classes from SPRAYER.

What organization do I support that advocates repatriating land to Mexico? NCLR doesn't advocate that and if you weren't a lazy fuck and went to their website and actually looked up what they stand for you would realize that.

In the end, I don't give a flying fuck if you take my advice. I raise issues that I feel are important. If you want to ignore that and my takes on that then that is your problem and not mine.

KC native
08-31-2009, 11:14 AM
Payback's HELL isn't it?




This....this is what we're paying back. You've got a lot of karma filled up here particularly when you came here starting with put downs.

Take a good look in the mirror, instead of wild projection being used as a defense mechanism.

Oh and you're still a crook. It's clear who's side your on. That's a fact.

ROFL I love it when you mention projection. You are a grade A idiot. If someone disagrees with you then you scramble to find a label you think fits and it one doesn't fit you torture definitions to make it fit in your head.

I guess this means my fake ignore is officially over now. ROFL

vailpass
08-31-2009, 03:59 PM
You might want to read up on what "The American Dream" really is. I can't say for certain, but I believe that being a part of it and supporting a group that wants to annex a large portion of the United States and return it to Mexico are mutually exclusive.

I'll start valuing your opinion on financial matters right after I start taking tips from Claythan on how to meet women and racial sensitivity classes from SPRAYER.

:D

Stewie
09-01-2009, 04:26 PM
As far as Stewie is concerned, there is a phenomena that is known as right for the wrong reasons (check out peter schiff for a pefrect example). Stewie has been right on the direction of the dollar in the past (or so I'm told) however anybody that was worth a shit saw a devaluation coming just due to the current account imbalance. Apart from that Stewie has failed to articulate his views and methods to achieve them, and despite him being right on the direction of the dollar he has failed to accurately represent his performance. If you want to put faith into a person that considers their subsequent purchases as part of their cost basis for their claimed return then you deserve to have your money stolen by wall street crooks.

In conclusion, you conservative ****ers on here can attack me all you want but it will not prevent me from showing you where you're wrong. I think it is extremely obvious how shallow your arguments are when you resort to attacking me while failing to cite where I have been wrong.

Sorry I missed this thread. I haven't had much time to wallow in the mire.

I've played the falling dollar since 2003 and missed the drop in the stock market. Sorry if that disappoints you KCN. My investments are doing quite well, thank you.

Anyway, on the leverage front: today China told the bundlers of debt and the creators of OTC derivatives to go to hell. That's why the markets took a dump today, led by the banks. The banksters now have their feet held to the fire with no one to buy their crap. Couldn't happen to a nicer bunch of assholes.

Nightfyre
09-01-2009, 07:00 PM
Also, helping banks leverage is their ease of access to capital. When banks leverage, businesses can leverage (and consumers) and the money supply grows. I doubt the Fed can/will do anything to curb inflation given Bernanke's history.

http://money.cnn.com/2009/09/01/news/companies/banks_capital/index.htm?postversion=2009090111

Raising capital still a breeze for banks
Even as financial firms have raised a whopping $51 billion in capital this year from stock sales, experts suggest that there is plenty of demand for new shares.
By David Ellis, CNNMoney.com staff writer

NEW YORK (CNNMoney.com) -- If banks ever had a capital problem, it certainly isn't showing.

Large and small lenders alike have successfully raised billions of dollars in recent months, thanks in large part to a renewed appetite in the banking industry by investors. And some experts anticipate it won't slow down anytime soon.

Secondary offerings of stock, for example, have become quite popular among banks in recent months. So far this year, financial firms have generated more than $51 billion in fresh capital through sales of new shares, up 43% from a year ago, and more than 5 times the amount issued in 2007 or 2006, according to data from research firm Dealogic.

"The amount of secondaries has been just mind boggling," said Scott Sweet, a senior managing partner at IPOBoutique.com, a research firm. "I have not seen a period like this in 35 years."

The rush to raise capital began in earnest after the government completed its stress tests of the nation's 19 largest financial institutions in May. Regulators ordered 10 firms, including Bank of America (BAC, Fortune 500), Citigroup (C, Fortune 500) and Wells Fargo, to raise nearly $75 billion combined in order to weather the recession.

But since then, healthier banks have tapped the public markets for a variety of reasons.

JPMorgan Chase (JPM, Fortune 500) sold $5 billion in stock in June with the specific aim of repaying money received under the government's Troubled Asset Relief Program, or TARP. Two weeks ago, BB&T (BBT, Fortune 500) raised $870 million by issuing new shares to help facilitate its purchase of failed Alabama-based lender Colonial BancGroup.
Renewed appetite

Prior to the stress test results, banks like BB&T and even Chase, would have struggled to raise any capital, as investors recoiled from any company even remotely associated with the banking industry.

There were fears about the underlying assets of many U.S. financial institutions. There were also concerns about how much of the government's preferred stakes in various banks might be converted into common stock. Doing so could effectively reduce the value of stakes owned by existing shareholders.

Many of those worries however, seem to have subsided, if not vanished altogether. As such, high profile investors are flocking back to the banking sector.
0:00 /3:14Banks face second wave of risk

Private equity investors have already made several key purchases of banks so far this year, and are poised to do more after the Federal Deposit Insurance Corp. agreed last week to lower requirements for buyout shops to purchase failed banks.

Top hedge fund managers have shown interest in the banking group as well recently.

John Paulson, whose firm Paulson & Co. profited handsomely by making bets against banks before the subprime mortgage crisis unfolded, acquired large stakes in leading lenders like Bank of America (BAC, Fortune 500) as well as regional banks Marshall & Ilsley (MI), Capital One (COF, Fortune 500) and Regions Financial (RF, Fortune 500) during the second quarter, according to regulatory filings.

At the same time, banks are feeling plenty of pressure from industry regulators to get their capital reserves to healthy levels, said Gary Townsend, president of the Chevy Chase, Md.-based investment adviser Hill-Townsend Capital. The rash of bank failures this year is a sign that the FDIC is willing to shut down those banks that are unable to raise new capital.

"Most [banks] out there right now are not so large that they are viewed as systemically important," he said. "And indeed, regulators would probably like to see fewer of these banks overall simply to reduce costs and headaches."

Still, it remains to be seen how sustainable this level of interest is by private investors and whether there will truly be enough demand for more stock sales by banks in the weeks and months ahead.

Dan Bass, a managing director at investment bank Carson Medlin, contends that there won't be a lack of willing buyers though. He points out that many investors are still sitting on a pile of uninvested cash and that bank stocks are likely to keep rising -- at least for the near term.

"I think people are getting confident that a lot of banks are at the bottom and on the way up," he said. To top of page
First Published: September 1, 2009: 11:10 AM ET