Many states are trying to work their way out of what’s been deemed a housing industry crisis. To say that things have been bad across the country would be an understatement. In 2009, the top housing markets were those that weren’t in a freefall, including my home area of Syracuse, which was flat yet considered as the 2nd best in the country.

Whether or not you believe unemployment has improved (it hasn’t), things have definitely stabilized in a fashion. And in some states there are plenty of houses that are available for purchase. And yet, not including places like Chicago, which has rebounded fairly well, those homes aren’t being purchased, and home ownership isn’t growing, or at least not growing enough to overcome the bad times.

What’s the problem? In my opinion, it’s all in the hands of the banking industry. True, I blame the banking industry for causing the problem in the first place, and now I’m blaming them for keeping it down. There are many reasons I’m blaming them; let’s take a look.

1. Not giving up the loans. I understand that banks have had a hard go of it, but many of them have gone too far in the other direction and are looking to loan people money who don’t really need it. When rich people with credit scores over 800 can’t get home loans, you know that banks have become skittish on who they want to loan money to.

2. Bank closings. So far, 102 banks have been closed in 2010; this is about 45 more banks than were closed at this point last year. Many more banks are projected to be closed this year. Many of the banks that have been closed are in states that are still having major problems with housing. As other banks are taking over, they’re being a lot more judgmental in who they’re going to give loans to.

3. Banks holding on to foreclosed homes. In some states that have had high foreclosure rates, banks are artificially trying to keep home prices up by keeping some homes off the market. Picking and choosing which homes they want to put on the market means there are many homes that someone might want that they can’t buy. Florida has many homes at low prices, and many of those homes are starting to be snapped up. It’s better for everyone if they can buy whatever home they want, even if the prices are lower, because it helps stimulate the entire industry. Banks, let up on the foreclosed properties.

4. Not processing loans quicker. The reason the federal government had to extend the time for people to finish qualifying for loan modifications is because banks could care less whether people qualify for it or not. They got called out for not processing more of these loans in a timely matter, but the truth is that it didn’t work in their favor, or at least they didn’t perceive that it did, so they didn’t have any reason to try.

That’s enough for the moment. To be somewhat fair, banks do have to change up their criteria a little bit. Some people who purchased homes before weren’t really qualified to buy those homes at the prices they got them for. Low interest rates don’t protect banks from people with risky credit, and that’s understood as well. However, as long as banks in areas with depressed housing markets won’t work with brokers and consumers to try to get them into homes, those markets will continue to suffer, which means the entire country will suffer along with them.

Actually, it’s just a bit longer than a month. By August 15th, consumers are supposed to make a decision with their bank accounts as to whether they want overdraft protection or not. It’s something I originally wrote about in February, but since we’re close to the date I felt it was a good time to look at it again.

In that previous post, I laid out the two main scenarios for help in making a decision on whether to opt in or not. At that time, I wasn’t sure if it was inclusive of credit cards as well or just banks. Based on knowing that, at least for now, that it seems to only concern banks (unless I’ve just missed the inserts in my credit card bill), I’m thinking I’d like to clarify my stance just a little bit.

If this included all credit cards, I’d probably say that it’s not worth the cost to have it added to your credit card account. In my opinion, it’s better to not be able to buy something using your credit card than going over the limit. However, the rules have changed on that front, such that credit cards can’t hit you with extra fees for going over your balance in that particular pay period. They can stop you from going too far over the limit, but if you’re over by less than $50, you’re okay.

When it comes to your bank account, that’s another matter entirely. All of us have had a time in our lives when we’ve written checks without knowing that older checks have never cleared. Some people you pay won’t cash your check for six months. Sure, we should all be balancing our checkbooks monthly, but we don’t. So, it might not be such a bad idea to have that extra layer of protection.

It depends on how much your bank is going to hit you for each transaction, though. For instance, my bank is going to charge $22 per overdraft, while my wife’s bank will be charging $25 per. The upper limit per day for everyone is $100, which is a good thing, but in essence, if I have 4 checks hit that puts me over I only pay $88, whereas my wife will be at the max. That’s not much difference, and it’s making me think about leaning towards the protection. My wife decided she was going that route, and it’s already been set.

Everyone needs to know their buying habits, but knowing that it’s not always in your control could lead you to decide for the bank protection, instead of bouncing checks all over the place. I think it’s a wiser move than I believed it was in February.

On April 30th, 7 banks were closed, including 3 in Puerto Rico, bringing this year’s total for bank closures to 64. That’s a figure that we didn’t hit last year until August. Based on the speed we’ve been at so far, we could conceivably hit 190 banks or more closed by the end of the year.

The closure of the Puerto Rican banks is somewhat stunning because there wasn’t a single Puerto Rican bank that closed in 2009 when things were really bad. In this case the three banks, Westernbank, Eurobank and R-G Premier Bank of Puerto Rico, close with a combined $14.84 billion in deposits. That will cost the FDIC around $5.28 billion.

The biggest bank to close on the day was in the state of Washington, where Frontier Bank, with $3.13 billion in deposits, and all 47 branches will be taken over by Union Bank, which is based in San Francisco. That’s also a dramatic change from last year, when banks that were closed were almost always taken over by other banks already in the state. It’s the second bank that Union took over in April, previously purchasing Tamalpais Bank, which was based in San Rafael, on April 16.

So it continues, but at least it’s not close to the rate that was predicted when it was forecast that 700 banks were in trouble.

Well, I guess it had to happen eventually.

After Citigroup finally posted its first profit in a very long time, the Treasury Department finally feels it’s time to shed itself of all that stock that they bought when Citigroup was in trouble.

How much are we talking about? The government, which by extension means we the people, own around 7.7 billion shares, which means about 27% of all the Citigroup stock. Because the stock price of Citigroup is higher now than it was when the government took it over, it will add some needed funds back into the United States coffers folks; I’m betting we’re not going to be seeing a dime of that for a long while, if ever, in our pockets.

Anyway, the government is only selling 1.5 billion shares right now, so we’re looking at a profit of around $2.4 billion. Oddly enough, Citigroup‘s share price dropped after the announcement was made, around 5%, which has thrown off the Japanese market by 5.2%; amazing how related all these things are, isn’t it?

Still, this is all good news for Citigroup, as it works to full sever all its ties with the federal government. It’s good news for the rest of us also, because it may mean that finally we, the people, are out of the banking business. Not sure we were all that good at it anyway; I’m not sure they’re all that good at it either.

I guess it had to happen eventually.

Citigroup finally announced a quarterly profit after many quarters of massive losses. They reported a profit of $4.4 billion in the first quarter of this year, compared to a $670 million loss at the same time last year. Supposedly they’ve turned the corner because of trading of bonds and equities, as well as their stock price pushing up around 15 cents in the quarter.

Something else they mentioned was that their losses from credit cards and mortgage loans have decreased, although they still have losses. On this front, I’m not sure if it signals that people have more money to pay their bills or if the worst has passed so that there can only be so many people left to still default on loans. And all of us know about some of the changes to credit cards lately.

The federal government is feeling more secure about things, so they’ve announced that they’re going to start selling their $7.7 billion dollars of stock that they got when they gave loan money to the bank. How fast they’ll sell will depend on just how secure they feel Citigroup is. After all, even with this great report, their stock price did drop last Friday, as did the price of other banks and financial institutions after the SEC announced it was charging Goldman Sachs with fraud.

For now, I’ll allow Citigroup its good news; it’s about time.

Interesting days for JP Morgan Chase, if you ask me.

On the financial front, things look pretty good. They just reported another profitable quarter, $3.3 billion in profits, up 55% from last year at this time. Sure, last year was bad for awhile, but no one scoffs much as that type of profit number. They’ve also announced that they’re planning on creating about 9,000 new jobs in the United States.

Chase is an investment bank, which is where they’re doing well. Where they’re still in trouble is the mortgage market, which lost $131 million, and its credit card services, which lost $303 million, which is actually better than last year at this time by around 45%, so they’re seeing that as a success as well.

So then, why are the students at Syracuse University upset that he’s been named as the keynote speaker at graduation this year? It seems that a petition has popped up on Facebook railing against his coming to the university; here’s what it says:

“We, the students, alumni and friends of the university, are against using the 2010 commencement to restore the public image of the banking industry and validate the anti-environmental and anti-humanitarian interests of JP Morgan Chase. We demand a graduation speaker sensitive to the current global climate that this class is poised to inherent on May 16th, 2010.”

Pretty strong words from a bunch of college kids, one has to say. I’m going this direction. Yes, I’m still mad at the major banks, whom I still believe helped to exacerbate the financial problems that this country is facing even today. I don’t think they did it all themselves, but they’re certainly a major contributory. But some of them have been able to turn themselves around, and certainly Chase might have done it without Jamie Dimon at the helm, but they might not have, and one can’t argue with the success since he’s been there. I think he’s a quality choice as a commencement speaker. And the chancellor, who happens to be very popular in this area, supports his coming, so that’s pretty much that.

Chase is smiling these days; for the country’s sake, let’s hope that continues for awhile longer.

This is scary; so far in 2010, 37 banks have been closed, with 7 banks being closed on Friday. For comparison purposes, last year around this time there were only 21 banks closed. As a matter of fact, there’s the possibility that if 5 banks are closed by this Friday it’ll double what was closed in the same period last year, as it was by the 27th, the last Friday of the month last year, that 21st bank closed.

The largest of the banks to close was Advanta Bank of Utah, with over $1.5 billion in deposits, and it was the only bank for which the FDIC couldn’t find a buyer, which means a lot of people are going to be getting checks in the mail. No word on how many of those depositor’s accounts were more than $250,000, but since it’s being reported that the cost to the FDIC is around $636 million, some people are going to be losing money on this deal.

Georgia is still in a major mess, as 3 of the banks that were closed came from there. They had the highest number of banks to close in 2009, and it looks like 2010 isn’t faring much better for them. If you have the stomach for it, you can follow the closed banks list like I do; misery loves company after all.

Most of us remember that it seemed like the financial world came crumbling down the day Lehman Brothers announced that they were going into bankruptcy. I have to admit that, even though there were overall signs that something wasn’t right, this was the defining moment when I knew this country was in trouble.

Ever since their collapse, there’s been an investigation as to why they failed, and I know why. You research things like this so you can see if someone else might be going in the same direction and should get an intervention so that they don’t collapse. That’s the one thing about the United States; it will try to find answers to bad things. Unfortunately, we don’t always learn from history either, and my thought is that this one will look and sound good, but in the end won’t stop any other banks from falling. Why? Let’s take a look at the main talking points of this investigation.

The first is that leadership lied to cover their bad performance. That’s not novel at all, and it’s the thing that’s brought down other companies in the past, such as Enron and Arthur Anderson. They even sent a young woman whom they’d made CFO only a couple of months earlier, Erin Callen, into the public to be the public face of the company, spouting all this positive stuff before she had a chance to look at anything and determine they were lying.

Something else they did was not count bartered items that were temporarily “repossessed” as loans. What they did for awhile was allow people to put up assets instead of collateral to trade for cash, but instead of calling it a loan they called it sales, which made both profits and liabilities look better, but wasn’t really legitimate. To say it wasn’t legitimate is to say that it took a foreign law office to tell them they could do it, because no American law office would. Now that’s sneaky and fraudulent.

Finally, they had some help in covering all of this up through Ernst & Young, who validated everything Lehman was doing even though they’d been informed by someone that it wasn’t legal to do. Does this remind anyone of David G. Friehling, Madoff’s accountant? Ernst & Young is a major player; they had to know this wasn’t legitimate, and they have a fiduciary responsibility not to certify this kind of thing. Oh wait, obviously they weren’t paying attention to the Arthur Anderson history either.

And that’s my main point. History repeated itself many times here, and it still resulted in another greedy banking institution and a weeping willow accounting company failing to do what was right. Why did Lehman fail? Because they didn’t pay attention in history class.

Everyone might not see it this way, but I think this is a pleasant surprise.

Bank of America has taken the proactive step of saying that they’re eliminating overdraft fees on debit card purchases. Well, that’s kind of a misnomer, but it works for the moment.

What they’re going to do if you use your debit card to try to make a purchase is to deny you, which is what credit cards and debit cards used to do in the past. That means you won’t get hit with fees you don’t know about by going over your banking limit.

What they’re also going to do is, if you go to an ATM to try to get money out and you don’t have it, tell you that you don’t have enough to cover what you’re trying to take out. You will have the option of accepting a $35 fee if you decide to go forward with that transaction, or do something else instead.

I think this is a brilliant move, and I’m glad to see B of A taking a step like this instead of just finding ways to get more money from unsuspecting consumers, especially when they’re not on the best financial footing. Not everyone keeps up with their money all that well, and sometimes it’s not your fault, such as when you think a check has been cashed months ago and had been checking your balance, and out of the blue it’s suddenly cashed and you hadn’t checked again. I’d rather have a store or restaurant decline me than turn around later to see I’ve been dinged with some high fees.

Good move, B of A; you’re off my list for the time being, even though you haven’t addressed those checking fees yet.

Last August I wrote a post talking about this study that said 416 banks were in trouble. It seems that the news is much worse about six months later, as the prediction now is that 702 banks, which is one out of every 11 banks in the country, are in trouble. That also includes a couple of big banks, my whipping boys Citigroup and Bank of America; isn’t that a shame?

To what are they attributing all this bad news? The three main criteria are finances, operations and management. We all understand the finances part; if banks don’t have enough money to conduct business, that’s obviously not good. Operations is where we look at the specific areas that banks might be having major problems with, such as mortgage debt, credit card debt, and loan defaults. Management also speaks for itself, although I wonder how the FDIC evaluates the competency of management.

A statistic that came out said that usually only 13% of banks on the watch list end up being seized, as they usually will find ways to extricate themselves out of their difficulties, even if it’s just to merge with another bank. That’s good news if you ask me. Something they didn’t talk about, though, is if some of the banks that are on this list are those who invest heavily in commercial real estate. That’s still a major worry as well.

So far this year, 20 banks have been closed, putting it on the same pace as last year, but FDIC Chairman Sheila Bair believes the number of banks being closed will escalate as the year goes on. That’s bad news, but maybe this is what’s needed to reign in banks across the board. Seems to be a long process in fixing things, doesn’t it?

With the new credit card legislation came another new provision that effectively takes a lot of non-voluntary money away from banks.

Overdraft fees were a big thing for banks. At some point, they started charging fees to people while still paying bills if you happened to go over your limit. The same goes for credit cards, which allows people to go over their credit limit for a minimum period of time. Banks didn’t mind because they’d hit you with fees that generated more than $20 billion in revenue a year across the board.

Now that is gone. Banks have to get people to opt into the program. Some banks are being very aggressive with this, such as Chase, while others are either still working out the logistics or will probably be sending up some kind of notice in our next statements, which I’m betting the majority of people won’t even read unless it’s sent separately.

Let’s face the fact that all of us have missed this every once in awhile. A deposit didn’t clear as quickly as you thought it would and suddenly you’re hanging because the payment did clear on time. Or you bought gas after making a payment on your credit card that didn’t clear yet and suddenly you’ve gone over by a few dollars.

Do you want to accept these fees or not? The question depends on just how close to the vest you usually are with your money and whether or not you pay attention to what’s going on. If you never overdraw, or very rarely do, you shouldn’t sign up for this protection because you don’t need it. Sure, you may be shocked those couple of times if something does happen, such as being out trying to buy something and having your card decline because you don’t have enough money in the account, but that’s preferable, in my opinion, to getting hit with a big fee later on because you were never informed you didn’t have the money on your credit card to cover it.

If you overdraw all the time, or are always right next to the line, then continue paying banks for the overdraft protection. Sure, it can add up, but it’s less embarrassing than trying to pay for things and getting denied all the time.

Just make an informed decision, then live with it. but gauge how high those fees are, because banks will be raising them, as it’s just one way they can recover from all those other ways they’re cheating customers nowadays. You did know about the credit card with 79.9% interest, right?

Once again, no one can be surprised by this move, after so much bad financial news and negative press. Citigroup and Bank of America got more bad news last week when their bond rating was downgraded from “stable” to “negative” by Standard & Poor. The initial outlook on both banks is that they’re still shaky, and if they needed to be bailed out again by the government they might possibly tank; my words, not theirs.

At the same time, Bank of America did get kudos saying that they seem to have the best chance to be stable as time goes on. S&P stated that Bank of America has “significantly improved its capital position during the past year and kept its liquidity strong, (though) earnings remain severely pressured.” As for Citigroup, they stated they believe Citigroup’s stand-alone position has improved, while also saying “”increased uncertainty about the U.S. government’s willingness to provide additional extraordinary support to highly systemically important financial institutions in a way that will benefit debt holders.”

What does all of this mean? It means that S&P is worried that these banks might not be healthy enough to totally go it on their own without the possibility that the government might feel compelled to help out in some fashion again, and they’re unsure, based on legislation that was passed last year, if that could occur in the first place. Supposedly the government can step in to help a company pretty much liquidate itself, but only if it’s in a bad debt position. Could the government break up both of these banks like they did AT&T many years ago, but for a much different reason?

It also means that S&P, though worried, believes that if both bank institutions will hold steady and not take unnecessary chances, while shoring up the areas in which they’re losing money (such as credit cards, where it’s predicted that both will probably continue big losses as long as unemployment doesn’t improve) that they could survive, since the biggest worry is both banks being able to continue to pay on their own debt.

Personally, if they had to be broken up I wouldn’t shed a tear; no, I still don’t trust them, even with Citigroup’s new idea on how to eases foreclosures. But that’s for another time.

Man, when it’s time to pile on…

On Thursday the Attorney General of New York, Andrew Cuomo, who might be running for governor of the state later in the year, charged former CEO Ken Lewis with fraud as it regards Bank of America’s purchase of Merrill Lynch at a time when the banking industry was in trouble, and B of A was near the top of that list.

In essence, the lawsuit believes that B of A made the purchase at that time because they knew the government might be able to bail them out of any financial difficulties, in essence using the government’s money to help them fund the purchase so they could then pay out big bonuses to former Merrill Lynch employees. It also claims figures were fudged that didn’t show in full just how bad a footing Merrill Lynch had financially, and some other improprieties.

This is something different for the Attorney General, who usually goes after corporations for bad behavior committed in New York, where Bank of America’s offices are located. This is a civil lawsuit, which means that Lewis won’t have the benefit of corporate lawyers, ergo unlimited funds, to help his case.

This blog wasn’t up when all of that was going on, but I had wondered at the time what B of A could be thinking in absorbing Merrill Lynch when everyone knew they were in trouble themselves. The idea of adding someone else who’d in financial trouble just didn’t make much sense, and pretty quickly after it was all done, Lewis resigned. It all looked suspect, but legal at the time.

Of course, Bank of America doesn’t totally get off the hook here. While the present CEO has no liabilities thrown upon him, they will have to pay $150 million to their shareholders because of the previous false information, along with some other changes as it regards shareholders and their rights as voting members. Supposedly, they had initially told the shareholders that no bonuses would be paid out to Merrill employees.

The big banks just keep digging bigger and bigger holes for themselves. Is it any wonder that we’re leery of them?

What’s the fallout of paying off TARP money when you’re really not ready? Citigroup ended up losing $7.6 billion in the 4th quarter of 2009, and Bank of America ended up reporting a loss of around $5.2 billion for the same time period.

They stated that their loss was due to having to pay back the federal government, but that’s a minimal reason. The biggest problems they had was collecting on credit cards and bad mortgage deals, having to hire a CEO, paying out lots of bonuses, and I hate to say it this way, but basically being stupid. Once again, like Citigroup, there really wasn’t a need to have to pay off this loan so early, even though they were having problems finding someone to take over their CEO position at the amount they were allowed to offer per the government’s restrictions.

Here’s the other side of this issue. They’re reporting that $4 billion of their loss was paying back the government, who they owed $45 billion, but a big part of their loss, which they say helps to show improvement, was charging off what they considered as uncollectible debts owed them by others. What most people don’t know is that when banks write off debt, they get paid by insurance companies for a percentage of that write off. Then they get sneaky and sell that uncollectible debt to someone else, collection agencies, who then come after you and try to collect more money than you actually have to pay them. Check out the link here on knowing your charge off amounts.

So, this means B of A made money by writing off money they couldn’t collect; isn’t that a shame? I guess didn’t think it was worth it to help any of those people who have mortgage problems because of some of their sneaky underhanded deals in some states to refinance their mortgages so they had a chance to stay in their homes; shame. And even with this loss, they’re still slated to pay $4 billion in bonuses, which comes to around $400,000 per eligible employee; man, I knew I went into the wrong profession years ago.

Oh well; maybe raising those checking fees will help them make a profit this year.

I hadn’t talked about it before, but I guess it’s time to bring it up. On Friday, 5 banks were closed, following the closure of another bank on Thursday, bringing the total to 15 banks in the month of January. At this pace, it will easily beat last year’s number of bank closings, which was 140. Based on predictions, however, even the average per month so far could be crushed as it’s expected that as many as 400 or 500 banks could be closed. That certainly puts a damper on things, as my post last year on the predicted 416 banks in trouble did.

The biggest bank taken over this week was First Regional Bank, with nearly $2.2 billion in assets and $1.9 billion in deposits in California. It’s the biggest bank closure so far this year.

One startling thing to follow is that three banks closed so far this year are in Washington state, which only had 3 closings total last year. The last bank that had closed there was on September 11th. Studies say foreclosures are slowly increasing in the state, yet it remains one of the low areas for foreclosures in the country, so the bank closings don’t make a lot of sense unless they’re tied in to the predicted commercial real estate crisis.

Anyway, this seems to only be the beginning of what could prove to be a scary year for banks across the country. At least no one is predicting that the record of 534 banks closed, which happened in 1989, is coming.

At least not yet.

I don’t know why, but I’m almost insulted by this.

It seems that not only are the rest of us worried about interest rate hikes, the banks are also worried about interest rate hikes. Why is that?

Because it seems that while many people haven’t been able to take advantage of the interest rate decreases as one might have thought, banks have been using the money we pay them and we deposit with them to borrow money at these extremely low rates and turn them into pretty big profits. They’re now worried that if interest rates go up, their profits will go down and possibly hurt some banks.

The truth of the matter is that all of us knows that if the banks aren’t making enough profits by borrowing this money and turning it around to use the way they’re doing it right now, they’re just going that more fees that they charged us already to make up the difference. There are two proven that they’re willing to take such drastic measures by their reaction to the new credit card rules that are coming.

Also, I find it ironic that the banks would go out there and say something like this and think that the rest of us would have any sympathy for them based on the behavior they’ve been exhibiting over the past couple of years. Personally, if another bank has to close because they’ve gotten used to being able to get loans and suddenly can’t, I’m all for it. Probably more banks need to be put into the position that some of the rest of us have been put in when we’ve been trying to get loans or credit cards. I mean, when even rich people can get loans to buy houses, then things are pretty bad all over.

There’s already a prediction that more banks will close than what closed in 2009, when we had about 140 banks shut down. Most of that is going to be related to commercial real estate, but if some banks are going to close because of their previous practices that, it seems, they haven’t learned anything from… oh well.

On Friday, the stock market took another big nose dive for the third day in a row. The Dow Jones dropped 217 points after President Obama’s speech, where he said that he wanted to have tougher regulations on banks that come up with tricks to help make their profits rise, but a very risky to both the banks and the economy.

Overall that just added to the 522 points total that the Dow had fallen over the past three days, four total of 5.2%. Investors didn’t seem to be happy with some of the bank reports that were coming out showing how their fourth quarters had performed. As I wrote a few days ago, it seemed as though some banks did well and some banks did badly, and except for a couple of the super large banks everything seem to balance out fairly well. I guess that shows how much I know about how investors think.

In general, the logical part of my mind just doesn’t get this. Whereas I have an understanding that investors want to try to make as much money as possible, they can be a single one of them who is forgotten just where we were last year at the same time. The stock market had gotten to a point where the Dow almost went under 6500, and that was pretty much because of the banking industry. Okay, not only the banking industry, but they were the biggest recipients of most of the government TARP money. For these same investors to now cause the market to fall just because President Obama wants Congress to pass legislation so that we don’t get into that position again just blows my mind.

It also isn’t helping that suddenly Fed Chairman Ben Bernanke isn’t looking like a slam dunk he seemed to be in getting renominated for his position. It also doesn’t seem to help that it looks like Tim Geithner is losing some of his power in dealing with the financial issues. His performance has been questionable for a while however, and it seems that he got out of the gate badly and never really recovered from the bad press of not paying his taxes. Overall, he’s never looked like the financial genius that some had thought he would be.

Personally I am in favor of President Obama’s directives; then again, I haven’t felt a lot of trust for any of the banks through all of 2009, and 2010 isn’t making me feel any more warm and fuzzy towards them. What are your thoughts?

On the heels of the bad news from Citigroup regarding their bad 4th quarter and good news from Chase regarding their 4th quarter, I decided to combine some of the reports from the rest of the bank’s all in one post just to get it all over with certain move on to other things.

Wells Fargo showed a very good profit of $3 billion for the 4th quarter, which was good especially since they also paid off their TARP loan in the quarter. Their profit was ahead of estimates, and yet some analysts still aren’t happy, saying that some areas of the bank didn’t perform as well as they had hoped. I figure you can’t have everything.

Bank of America posted a $4.2 billion loss in the quarter, which also included them paying back their TARP government loan. They’re saying that $4 billion of that loss was the repayment of the loan, that almost seems disingenuous sense they had to raise money to pay off that loan in the first place. The loss was also worse than the loss they showed in the 4th quarter, when they lost $2.4 billion.

Wilshire Bancorp reported a profit of $3.2 million, which isn’t great but is still better than the fourth quarter of 2008 and they lost around $6 million.

And finally, Goldman Sachs reported a profit of $4.95 billion in the 4th quarter, crushing estimates by more than $3 a share. They supposedly did well because of the growth of the China market, which reported an overall growth of 10.7% for 2009. They also reduce the amount of bonuses that they had been paying out, decreasing the amount by around $4 billion from what they paid out in 2007.

Some quick hitters includes Bank of New York showing a profit of around $2.5 billion, KeyCorp showing a loss of around $750 million, and U.S. Bancorp showing a profit of around $600 million.

Overall, banks seemed to have done fairly well, but there are worries on the horizon as new regulations kick in from the FHA on mortgage lending that could reduce revenues drastically for some banks. Maybe that’s why Citigroup is trying to get out of the mortgage game.

This was expected. Citigroup announced that they had lost around $1.6 billion in the 4th quarter of 2009, mainly from trying to pay off the federal government, and that ends up giving them a loss of $7.6 billion for the year.

That’s certainly not the best news for a banking system that’s trying to convince everyone that they’re ready to be self sustaining and push forward for 2010. That loss, by the way, includes the tax breaks that they know they’re getting from the federal government that were related to the TARP loan, but doesn’t include any of the projected fees that President Obama is planning on hitting all the banks that got TARP money with.

Perspective can be a wonderful thing. The loss was compared to last year’s loss of $17.3 billion and thus is seen as things improving. Maybe my math is bad, but when you show a loss in 3 of 4 quarters in a year, and the only quarter you didn’t show a loss was because of the sale of one of your divisions, that’s not good at all in my eyes. Sure, it’s not as bad, but it’s still not good. And it’s definitely not Chase good, which posted a $3.3 billion profit.

I hate to be the one predicting bad news, but I don’t see Citigroup making a profit in the first quarter of 2010 either. They’re reducing their mortgage division, suffering more losses in their credit card division, and frankly have become too unwieldy. They’re saying they believe some of their foreign markets might be improving, but that’s “iffy” talk and nothing concrete. They’re missing this, but the American public doesn’t trust them after a series of sneaky and underhanded moves in 2009. It’s going to take more than “thank you” to get our trust back.

I don’t wish Citigroup bad karma, but it seems they’ve found a way to generate that on their own.

I tell you, it’s so strange trying to figure out finances and the stock market sometimes. The story about JP Morgan Chase gives us a dichotomy of fortunes that are somewhat incomprehensible when you’re trying to understand how some of these people who play the stock market think.

Chase stated that they had a profit in the 4th quarter of 2009 of $3.28 billion dollars. That announcement made their stock price drop 2% on the day.

Okay, not only that bit of news. Investors were upset that the stock price didn’t hit 5 cents per share as a quarterly dividend. They’re upset that Chase is paying out $9.3 in bonuses. They’re upset that Chase lost over $300 million on credit cards. They’re upset that Chase was around $1.5 billion under the estimated revenue for the quarter. And they’re worried about the continuing mortgage industry’s slide, more foreclosures, and thus the potential for more losses to come.

I’m still thinking that wasn’t enough to make its stock price fall like it did. Chase only made $700 million in the 4th quarter last year when things were really bad. True, I’ve taken my shots at Chase here and there for what I consider as some customer unfriendly practices, and they still made a heck of a big profit, which will probably turn out to be one of the bigger bank profits announced when the other banks fess up eventually.

Are the days of faith in the big banks over?