I have been watching the banking sectors for a few weeks now. Some of the strong banks like Wells Fargo WFC, Royal Bank of Canada RY, Toronto Dominion TD and investment bank GS have already recovered nicely over the past 9 months or so.
Some of the banks that have been irresponsible in their actions during the housing bubble have been hit really hard -- nothing new there.
Yet, I think, I see some good things start coming out for them. I personally like Llyoids Banking Group LYG, Bank of Ireland IRE, Allied Irish Banks AIB and many others like ING that start to come out slowly from the dump.
Watch carefully for banks that make money in Q4 2009 and yet still get hammered at the end of Q4 2009. Banks should make good money in 2009 with super low interest rate that they get and loan the money to customers and businesses for a good margin (if they still lend and do their job well, they should manage to get healthy profit margin) therefore this will show up slowly on their books. In turn, it should increase investor's confidence.
Let's watch these banks in the coming months and see how they reward investors hopefully
