Will the Big Bank Comeback Continue

Big banks have received a lot of support from the Government in the last 18 months. The help has come in many forms ranging from unprecedented Federal Reserve lending to Yield Curve support.





The help has translated into significant up moves in the stock prices of some of the biggest banks.



Thanks to some share conversions, the impact at a Market Cap level for Citigroup is even more pronounced.



The difficult part of the bounceback, however, is trying to figure out if the worst is really behing the banks in terms of fundamental performance. Across the industry, charge-offs have not yet begun to improve.



Further, Loan Loss Reserves are still below recent historical averages.



While we are no longer talking about failures at the big banks, it may be a long time before we begin talking about record profits either.