Wall Street Pounds Florida's Big Banks

Consider the performance of the four largest out-of-state banks that collectively control more than half of Florida's deposits.

Shares in Wells Fargo, Florida's biggest bank thanks to its acquisition of Wachovia, were down 24 percent; ditto the double-digit drop for shares of No. 3 SunTrust and No. 4 Regions Financial.

And for the state's second-largest bank, Bank of America, the scenario was even worse. Shares fell another 29 percent to close at $5.10, compounding a 45 percent slide last week. One analyst estimated the Charlotte megabank, struggling with its Merrill Lynch acquisition, needs at least $80-billion to restore capital to adequate levels.

Bank of America's tumble was seen as one more sign the credit crunch is far from abating. Financial losses from the credit crisis may reach $3.6-trillion, suggesting the banking system is effectively insolvent since it starts with capital of $1.4-trillion, said New York University professor Nouriel Roubini, who predicted last year's economic crisis.

"This is a systemic banking crisis," Roubini said at a conference in Dubai on Tuesday.

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