Biggest Banks Likely Beneficiaries
July 15, 2008
In commercial real estate, the best buildings tend to maintain the highest levels of occupancy, even in a downturn. As the market softens, tenants try to take advantage by moving into better buildings.
I suspect what we’re seeing right now in banking will be similar to what happens in commercial real estate. As the media continues to put a spotlight on troubled financial institutions, depositors in those banks are very likely to withdraw their funds and seek a safe-haven. That safe haven is likely to be this country’s largest banks, such as Bank of America, Chase, Citibank, and Wells Fargo. Bank of America alone, for instance, holds about 8-10% of this nation’s deposits.
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