Bank stocks were already having a rough day of it, now there’s more to come: CNBC just reported the state of Massachusetts’s Secretary of State William Galvin sent a letter friday to several banks asking about their activities underwriting various state initiatives and whether they purchased credit default swaps on state munis.
The state is looking into whether there were any conflicts of interest between the banks’ dealings in state munis swaps and what they presented to their banking clients.
The banks are Bank of America (BAC), Citigroup (C), Goldman Sachs (GS), Morgan Stanley (MS), Deutsche Bank (DB), UBS (UBS), JP Morgan Chase (JPM), and Barclays (BCS).
Speaking of swaps, banks’ credit default swaps’ spread widened this afternoon, with B of A going to 144 from 134, Citigroup going to 175 from 162, Goldman to 172 from 168, JP Morgan to 97 from 89, Morgan Stanley to 190 from 182, to cite just a few.
Banking stocks, which were down all session, have picked up a tad in the last hour: GS is down $1.78, or 1.2%, at $142.87; Citi is off 13 cents, or 3%, at $3.96; BAC is down 60 cents, or 4%, at $16.27; MS is down 71 cents, or 3%, at $26.91; BCS is down $1.11, or 6%, at $17.99; JPM is down $1.20, or 3%, at $39.61; UBS is down 63 cents, or 4.3%, at $13.99.
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