Transcribo akí este artículo ke me ha parecido interesante.
De forma muy resumida refleja la situación actual y cambios de liderazgo en la banca americana.
(Moraleja : cuidado con Citi
)sdos.
=DJ MARKETWATCH VIEW: Wall Street's New Power Structure
By David Weidner
A DOW JONES COLUMN
In the financial industry, down is up. Iconic bank brands that once inspired confidence now strike fear into the markets.
At the same time, small and focused institutions that once were considered old-fashioned, glacial and one-dimensional are emerging at the top of the heap.
No bank better exemplifies the fall of the giants than Citigroup Inc. (C). It was once the biggest company on the planet (by market value) and the most profitable, too.
But in a sign of the times, this once-grand American name has buckled under the credit crisis by turning in four consecutive quarters of losses as its market value continues to wither away.
Is Citi too big to fail? We may soon find out.
For now, the company continues its descent among U.S. financial institutions, a group that isn't exactly going gangbusters. The Amex Securities Broker/Dealer Index has fallen almost 74% from its highs in December. The Philadelphia Bank Index is down 55%.
Citi, which as recently as 2006 still had a market cap of $260 billion, now is valued a little more than $34.9 billion after Wednesday's 23% sell-off. It's worth less than U.S. Bancorp (USB), the Minneapolis-based bank with a strong regional presence in the Midwest.
"Should the stock market ever stop falling, (U.S. Bancorp) should be a solid investment," Dick Bove, an analyst with Ladenburg Thalmann, wrote in a note to clients Friday.
Citigroup is hardly alone. Merrill Lynch & Co. (MER), Washington Mutual Inc. (WAMUQ) and Lehman Brothers Holdings Inc. (LEHMQ) in their own distinct ways were the purveyors of a new kind of banking.
Merrill was a mix of refined finance and retail brokerage. WaMu was a new breed of retail bank. Lehman pursued the most sophisticated of securities transactions.
The New Landscape
But for every Citi or Merrill, there are successful banks that have filled the void. We all know the obvious winners in this shakeout. Jamie Dimon at JPMorgan Chase & Co. (JPM) has not only picked off rivals' clients, but also added the people (Bear Stearns Cos.) and branches (WaMu) to give his bank greater capacity.
Dimon's Southern counterpart, Ken Lewis at Charlotte-based Bank of America Corp. (BAC), also seized opportunities by snapping up Merrill Lynch and Countrywide Financial Corp.
And Goldman Sachs Group Inc. (GS) now only competes with investment banking arms of commercial banks.
But there are other beneficiaries too. A range of companies, some regional, others national, have emerged as leaders. Though they differ in business model and client base, they share some common characteristics:
- Investors like them. These financial firms have beaten their peers and are trading above book value, mostly because ...
- Their balance sheets are clean. Whatever the reason, these firms avoided stuffing their balance sheet with toxic securities that were rendered nearly worthless in the subprime mortgage disaster.
- They are focused. Other than JPMorgan, the financial firms emerging from the wreckage have simple business models. They either avoided trouble or had an easy time cleaning up because of the nature of their business.
First among these firms is Charles Schwab Co. (SCHW), the San Francisco-based discount brokerage. Schwab, with a market cap of $16.92 billion, will be the biggest stand-alone retail brokerage after BofA absorbs Merrill. Schwab's net profit margin is 24%, and it trades at four times book value.
Schwab is closely followed in its corner of the market by TD Ameritrade (AMTD), OptionsXpress Holdings Inc. (OXPS) and Interactive Brokers Group Inc. (IBKR).
In the institutional brokerage world stands Larry Fink's BlackRock Inc. (BLK). BlackRock stock trades 1.1 times book value, has a market cap of $12.84 billion and a 19% profit margin.
BlackRock already was a big-time firm, but its clout has only grown since being awarded a couple of plum assignments from the government. Fink's firm is managing the $30 billion asset portfolio once held by Bear Stearns - a portfolio that actually may make money under BlackRock's care. It also has assignments from American International Group Inc. (AIG) and was hired to assess the risks at Fannie Mae (FNM) and Freddie Mac (FRE).
After BofA and JPMorgan, Wells Fargo Corp. (WFC) appears ready to claim its post-mortgage-crisis place among the money center banks. Wells snapped up Wachovia Corp. (WB) to become a national bank second only to BofA, and it's the second-biggest U.S. bank by market cap at $81 billion - even ahead of Bank of America at $59.6 billion.
Then there are the boutique advisory firms that will become the dominant corporate bankers. Greenhill & Co. (GHL), Evercore Partners Inc. (EVR), and though it's bigger than a boutique, Lazard Ltd. (LAZ). Each of those firms turned a perceived weakness - the lack of a balance sheet to provide funding to its clients - into an advantage.
It used to be that banks such as Citi were able to beat the Greenhills of the world by sheer force: financing, brokerage services, transaction services - you name it. But with 50,000 Citibankers hitting the pavement in the coming weeks, what kind of force is left?
Citi is the bank now playing the waiting game. It's hoping its rivals make a critical mistake or that market forces will come to the rescue.
For now, though, the underdogs are having their day.
(David Weidner covers Wall Street for MarketWatch. He can be reached at 415-439-6400 or by email at [email protected].)
(END) Dow Jones Newswires
November 20, 2008 06:35 ET (11:35 GMT)
