Shares of big out-of-state banks with branches in Connecticut fell again today, extending sharp losses earlier in the week, due to ongoing anxiety about the government’s ability to restore the industry to health.
After a period of optimism about the government’s economic stimulus plans and actions for fortifying banks, investors want to be focused back on the economy.
But in a reminder of how bad things still are, shares of Bank of America Corp. and Citigroup Inc. slid more than 11 percent each in afternoon trading today. The Keefe Bruyette Woods Bank Index, which tracks 24 of the nation’s largest banks, fell to record lows.
Among other decliners in late afternoon trading today, Wells Fargo & Co. was down 4.5 percent, while JPMorgan Chase & Co. fell 1 percent.
Shares of major banks have been tumbling in recent days as rumors of nationalizing U.S. banks system continued to circulate.
“You are seeing a lot of nervousness about the bigger banks that are thought to be having problems,” said Bert Ely, a banking industry consultant in Alexandria, Va. “BofA and Citi are on the top of everyone’s list.”
Charlotte-based Bank of America’s stock price dropped earlier this month after speculation that the government might seize the company. At the time, bank Chief Executive Ken Lewis said the rumors were “unfounded.” (AP)
