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Mendon Capital Advisors founder Anton Schutz weighs in on the state of the financial sector
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Can't call and some more banks Bank of America barely posting a profit in the most recent quarter.
-- you got Citigroup in the middle of a major executive shake up.
So what is going on the financials and conscious is here to tell you he has written -- new capital advisors he runs the Burnham financial industries fund.
And the financial services fund -- anti ended the scene.
Let's start a Bank of America first in the profits look lousy.
But if you look at their business in terms of loan origination and deposits it seems to be on the right track.
Yeah absolutely bank and in America is on the right track -- -- -- building capital they're cutting costs.
And they have a very strong mortgage engine and obviously anybody's had mortgages had some pretty good growth in terms of running this quarter.
But I think they've held margin in line but the biggest thing for BankAmerica biggest worry it's been out there is.
It's been their balance sheet it's been how much capital -- have they don't have -- and there's a significant amount of progress made this quarter.
You look at the stock though 71%.
Gain so far this year and -- is.
All of did did are all the good things that are going on at the bank already factored into it.
Well I mean I think it was artificially low last year if you were called may have been around five dollars.
In the month of December is making a big deal that where was there was lot of noise lot of mortgage litigation risk.
And -- the end -- -- -- you have a book value this company that's north of thirteen dollars -- share.
And you hopefully the company's Camille start buying stock back -- in the next C car.
I think they've made it through the you know the valley of death and and you know I think this company slowly healing.
And terms of hailing there's a lot of healing that needs to be done at Citigroup particularly with the sudden now star.
A Vikram Pandit do you like the company and do you like the new management.
Well I knew Vikram and I like Vikram.
I don't know Michael but he comes you know pretty well recommended the regulators like him and I think that's very important here.
The regulators did not appear like they're grown I think Vikram was smarter any regulator in the room in their -- intimidated them and he didn't back down I think that -- like that.
So I think adding.
Banker in who works well with the board works well with the regulators.
Place nice will allow the company to return capital increase dividends buy back stock and I think that's.
Kind of then they came here Vikram really get a lot of stuff he shrunk to balance sheet sold lot of businesses.
Into the new city is all about returning capital and I think Russert CNN.
Mr.
Canton -- you wouldn't can you give me a couple word answer of all of the areas of financial player regional banks are big banks.
The few investment banks are left which of those groups you like the best right now.
Well right now you know you have to like investment banks -- there's some good -- -- out there is good fixed income.
Underwriting.
We like -- -- equity pick up a little bit but the markets are.
Are stronger such like investment banks like Morgan Stanley or Goldman Sachs -- -- is not reported yet.
And obviously the comings and have capital markets within their balance sheets.
In a BankAmerica should get one of the weaker numbers -- -- of our capital markets but JPMorgan strong cities strong -- strong.
And I expect you know good things at a Morgan Stanley.
Great same -- taking it left -- we'll see Jason you walk back any time now this isn't a.
