Savings and Loans Sector Struggles to Resume Growth as Interest Rates Remain Low
April 15 2011 - 8:16AM
Marketwired
In recent quarters most companies in the Savings and Loans industry
have been setting aside less money to cover loan losses. More
thorough and cautious credit checks have led to fewer delinquent
loans and greater financial stability. While the improving margins
helped narrow losses among these banks, long-term growth worries
still loom. Loan growth has steadily declined due to economic
uncertainties. As evident from the high unemployment numbers,
companies are not hiring at the pace most analysts expected, while
capital spending is way down. The Bedford Report examines the
outlook for companies in the Savings & Loans Industry and
provides research reports on Flagstar Bancorp, Inc. (NYSE: FBC) and
People's United Financial, Inc. (NASDAQ: PBCT). Access to the full
company reports can be found at:
www.bedfordreport.com/2011-04-FBC
www.bedfordreport.com/2011-04-PBCT
Despite the ongoing economic recovery, several companies within
the savings and loans industry are still struggling to resume
growth, primarily as a result of low interest rates. Many companies
in the industry have warned that unemployment and the increased
role of government-owned companies in the mortgage market may weigh
on results moving forward.
Housing market reform could create opportunities for companies
in the savings and loans industry with marginal debt issues.
Smaller banks may be able to originate more housing loans as
Washington mulls its options regarding government sponsored
enterprises.
The Bedford Report releases regular market updates on the
Savings and Loans Industry so investors can stay ahead of the crowd
and make the best investment decisions to maximize their returns.
Take a few minutes to register with us free at
www.bedfordreport.com and get exclusive access to our numerous
analyst reports and industry newsletters.
Shares of Flagstar are down more than 90 percent from two years
ago. Flagstar Bancorp has struggled as much as any company in the
savings and loans industry since the start of the recession due to
its heavy presence in the mortgage industry. Earlier this month
Assured Guaranty sued Flagstar, seeking more than $100 million in
damages, alleging that the bank breached warranties on home equity
loan securities it had insured.
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