Magazine article American Banker

Market Fear Renews Bank Stock Plunge

Magazine article American Banker

Market Fear Renews Bank Stock Plunge

Article excerpt

Byline: Katie Kuehner-Hebert

Shares of Citigroup Inc. dipped below $1 Thursday, though they recovered to close at $1.02.

The KBW Bank Index fell 11.81%, as investor confidence in the sector continued to erode, according to observers. The broader markets also fell a day after posting gains. The Dow Jones industrial average shed 4.09%, and the Standard & Poor's 500 index slipped 4.25%.

Bank shares' losses were widespread. Bank of America Corp. fell 42 cents, to $3.17, and JPMorgan Chase & Co. 14%, to $6.60 - its lowest close since November 2002. Citigroup fell 11 cents to its $1.02 closing price, though at one point it had been trading at 97 cents a share, its lowest since October 1983.

"Citi's stock is being driven down because the government's preferred shares have been converted to common, which has been significantly dilutive to book," said Theodore Kovaleff, the president of the buyside firm Information Sources Group in New York. …

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