Regional Bank Index Drops Amid Credit Worries

Benzinga

Regional bank stocks slid amid rising loan losses and bankruptcies, fueling new M&A speculation. Analysts say weak valuations could drive consolidation as larger lenders eye struggling peers for strategic deals.

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00:00It's Benzinga, bringing Wall Street to Main Street.

00:02U.S. banks are facing renewed M&A speculation as loan losses are wreaking bankruptcy pressures

00:07for regional lenders that occur in Reuters.

00:09The KBW Regional Banking Index dropped more than 6% Thursday before rebounding on Friday,

00:14down nearly 5% this year.

00:16Analysts say weakness in bank valuations can spur deals as larger banks look to absorb

00:21smaller struggling pairs.

00:22Zion's bank corporation has closed commercial loan losses and Western Alliance find a fraud

00:27lawsuit against Canter Group, ending the market jitters.

00:30Michael Driscoll of Morningstar and DBRS said bank loans were mostly performed well, though

00:35recent large loan issues have sparked fears of wider deterioration.

00:39Greg Hertrick of Nomura added that the latest market sell-off may accelerate existing strategic

00:44M&A talks rather than attract new participants.

00:46For all things money, visit Benzinga.com.

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