Foreign Bank Stocks: Red All Over

On Friday Feb 20th, US banks Bank of America (BAC) and Citigroup (C) fell heavily on huge volume due to nationalization fears. Bank of America fell to $2.53 before ending the day at $3.79 after the White House reassured investors that nationalization was not in the cards. Similarly Citibank closed at $1.95. BAC is down 73.08% so far this year and Citibank is off nearly 71%.

While the banks in the US are getting decimated, foreign banks are not immune either. In fact some of the global bank stocks have performed equally or even more worse than the US banks.

The following table shows the Year-To-Date (YTD) performance of global bank ADRs listed in the US organized exchanges:



Foreign Bank ADRs Year to DAte change

Note: All data as of Feb 20, 2008

As seen from the table and chart above, only two Chilean banks – Corpbanca(BCA) and Banco De Chile(BCH) are up this year. The Irish and British banks are the worst performing banks with huge losses.

Today The Times reports that RBS will be split into good bank and bad bank as part of a radical restructuring plan. Last month Ireland nationalized the Anglo Irish Bank but ruled out the nationalization of the other two banks – Bank of Ireland (IRE) and Allied Irish Banks(AIB). Overall banks in the developed world have performed worse than the ones in the emerging markets year to date.

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