You can take that to the bank
U.S. bank shares traded higher after Treasury Secretary Timothy Geithner said firms had strengthened and there is “absolutely” no chance of another collapse like Lehman Brothers in 2008. Geithner made the statement today while testifying before the Senate Banking Committee, and didn’t mention any banks by name while answering a question about Morgan Stanley. He said, “The direct exposure of the U.S. financial system to the countries under the most pressure in Europe is very modest. Our firms, and this is true across the largest institutions in the U.S., again are in a much stronger position if you look at their capital levels, levels of leverage, how they’re funded.”
Banking stocks have taken a beating over the past months as investors have been spooked by their exposure to European banking. Separately, Barack Obama said the recent hike in fees charged by U.S. Banks were not “good practice” or “necessarily fair to consumers.” He did say that banks can charge what they like, but transparency and accountability are key, adding that it is important for the government to play an oversight role. Bank of America recently said it was going to begin charging customers a $5 fee in each month that they use their debit cards, a move which has been unpopular with consumer groups and many politicians.
Bank of America (BAC : NYSE : US$6.28), Net Change: 0.51, % Change: 8.84%, Volume: 333,653,606
Morgan Stanley (MS : NYSE : US$15.18), Net Change: 0.70, % Change: 4.83%, Volume: 49,246,504
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