Banking / Finance : Large or Small, Most Bank Stocks Are Having Problems

Small bank stocks often have been in the doldrums during the past decade. And now these stocks are making investors unhappy again. “Little bank stocks are out of favor,” said Mark Matheson, research analyst for Cruttenden & Co. in Newport Beach. “People are nervous.” even good stocks in bigger companies, like Downey Savings & Loan, show that bank stocks have grown cold, he said. There simply aren’t enough buyers, he said. Downey rode through the initial stock dip two weeks ago without much problem, then fell about $2 a share last week to $11.75, a 52-week low. A spokesman said nothing has occurred at the Newport Beach thrift to cause the drop.

“It’s just not a good environment if you’re going to have another six to nine months of recession,” Matheson said. “Two years ago, local banks were just flying. For a six-month stretch, investors were making money in bank stocks. They (bank stocks) had their day. They’ll come back again.”