Bloomberg TV hosted the outspoken and well-known bank analyst Meredith Whitney early Tuesday morning about the banking sector and the future trends that have to be addressed in banking and brokerage operations. She said that the banking sector has to continue to aggressively cut expenses and the old way of making money on Wall St. is gone.
Whitney said the business models have to shrink more than they already have. Citigroup Inc. (NYSE: C) was the first mentioned on needing cost cuts, but she did say they are cutting areas. She also said that Bank of America Corp. (NYSE: BAC) is making good progress, as is JPMorgan Chase & Co. (NYSE: JPM).
Whitney also commented that net interest margins are shrinking. She said that investors are not appreciating the risk they are taking, and she and Dick Bove both agree that tens of thousands of layoffs are still coming.
Today’s news was not exactly earth-shattering by any stretch, but it will be commented on throughout the day. Updates may follow if more comments come out.
JON C. OGG