After last night’s additional bailouts of Citigroup and Merrill Lynch, more than $50 billion has now been committed to Wall Street’s big six firms – the vast majority of which has come from sovereign funds in undemocratic countries.
While the billions being written off are incredible, these are just accounting entries and the real market indicator comes from share price movements and the valuations attached to individual firms.
This remarkable list shows how much the big US financial names each fell last night, the overall decline from the highs of the past 12 months and the current market capitalisations:
- Bank of America: slumped 3.42% last night to $US37.88. Year high $US54.21 and current cap $US168.12bn.
- Citi: slumped 7.3% last night to $US26.94. Year high $US55.55 and current cap $US134.2bn.
- JPM Morgan-Chase: slumped 5.3% last night to $US39.17. Year high $US53.25 and current cap $US131.6bn.
- Goldman-Sachs: slumped 4.15% last night to $US193.29. Year high $US250.70 and current cap $US76.87bn.
- Morgan Stanley: slumped 3.62% last night to $US47.13. Year high $US75.50 and current cap $US49.78bn.
- Merrill Lynch: slumped 3.62% last night to $US47.13. Year high $US98.68 and current cap $US45.4bn.
- Bear Stearns: slumped 5.17% last night to $US77.57. Year high $US172.61 and current cap $US8.96bn.
- Countrywide: slumped 4.6% to $US5.81 last night. Year high $US45.26 and market cap $US3.36bn.
Some of the key stats to take away from this are as follows:
- The US Big Six are now only capitalised at only $US606 billion, whereas our big five retail banks plus Macquarie Bank are today worth about $US220 billion, even after the 2% slump in our broader market.
- Bear Stearns at $US8.96 billion is worth almost half as much as Macquarie Bank.
- The Commonwealth Bank is easily more valuable than Morgan Stanley and Merrill Lynch.
Countrywide, the biggest home lender in the US with 9 million customers and $US1.5 trillion in loans, is only worth $US3.36 billion and its saviour, Bank of America, is already down $US1.5 billion on its initial bailout last year, before considering possible losses from its proposed takeover of the whole business.
It is no surprise that the foreign rescuers are proposing far tougher terms this time around because, for instance, the Chinese Government has already dropped 33% on its initial $US1 billion injection into Bear Stearns.
The Singaporeans are almost $US2 billion down on their rescue of UBS and Abu Dhabi has lost more than $US1 billion on its $US7.5 billion plunge into Citi.
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