Smaller%20Lenders%20Struggle%20to%20Survive%20Article -...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
APRIL 15, 2011 Smaller Lenders Struggle to Survive By ROBIN SIDEL The factors that propelled quarterly earnings at J.P. Morgan Chase & Co. this week aren't doing much to help smaller institutions struggling to stay afloat. For some, like Birmingham, Ala.-based Superior Bancorp, time may be running out. Large institutions, some of which were clobbered during the financial crisis but are now enjoying profit growth, have an array of disparate businesses from credit cards to investment banking. Strong performance in one division can be used to offset troubles in another. Similarly, their national reach helps soften the blow of a trailing economic region like Florida, for example. And when a region or division starts to improve, big banks can boost profits by releasing funds set aside to cover bad loans in those areas. Regional banks typically have fewer rabbits in their hats. Many still are wrestling with the fallout from credit that they extended to borrowers before the financial crisis, even though loan delinquencies and defaults are declining. They are concentrated in fewer geographic areas and have fewer lines of business to cushion them. "The smaller names are certainly in a very precarious and difficult position because their credit problems are enormous," says Gerard Cassidy, an analyst at RBC Capital Markets.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 01/26/2012 for the course FIN 4620 taught by Professor Patriciarobertson during the Spring '12 term at Kennesaw.

Page1 / 2

Smaller%20Lenders%20Struggle%20to%20Survive%20Article -...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online