Play the stress test guessing game!
Investors, analysts, economists and journalists are all trying to figure out which of the largest U.S. financial institutions will need to raise more capital. The Fed's explanation last week of the tests' methodology, which a lot of people had hoped would provide a glimpse at the answer key, wasn't very illuminating. That means most new information is coming from leaks. And the latest whispers say at least half a dozen banks could need more money.
The stress tests showed at least six of the 19 banks examined need additional capital, people briefed on the results told Bloomberg News. There's no indication yet which companies may fall into that group, but Citigroup (C) and Bank of America (BAC) are reportedly there, and Doug McIntyre, a DailyFinance contributor and editor of 24/7 Wall St., thinks the markets are pegging Fifth Third (FITB), Key Corp. (KEY) and Regions Financial (RF) as likely to follow suit.
Analysts who have crunched the numbers have their own takes. Morgan Stanley analysts see Fifth Third, Key and SunTrust (STI) as most likely to need more capital. Meanwhile, analysts at Keefe Bruyette & Woods are looking at Regions and Fifth Third, as well as Wells Fargo (WFC), which could need to raise as much as $50 billion more.
Is any end to the speculation in sight? Sure -- the results of the tests will be announced in less than a week. Until then, expect daily leaks, guesses and analyses to move bank stocks. And don't be surprised if any financial stock under-performing the sector raises fears about a less-than-stellar grade.