Wall Street Woes

Despite Washington’s last minute decision to raise the debt ceiling, the stock market has tumbled in the last week, leaving all sectors of the market questioning its financial stability. On August 8, 2011, the Dow plummeted more than 600 points as the market re-rated the U.S. growth outlook.

Bank of America was among those hardest hit. Forbes reported, “Bank of America was among the session’s worst performers, with shares being dumped amid a surge in volume. The bank is facing a $10 billion lawsuit from American International Group over mortgage-backed securities tied to its Countrywide and Merrill Lynch units. BofA’s stock was down a stunning 20.1%.”

However, last week the Wall Street Journal reported that not all banks have a negative outlook on the market. Reporter Francesco Guerrera said, “On one hand, the unexpected bounty provides them [banks] with cheap funding that can be put to work in the form of loans. At the same time, the new deposits swelled their liabilities (deposits are counted as liabilities because they will one day return to their owners)—raising the unwelcome possibility that regulators will force them to add more capital to their balance sheets.”

How is the current market and capital requirements affecting your institution? What would you do differently? Do you think the U.S. is headed for a double-dip recession? Leave us a comment below.

The World’s Most Innovative Companies: Where Are the Financial Institutions?

Forbes recently released its list of the World’s Most Innovative Companies, aiming to answer the question, “Which leading-edge corporations are most likely to succeed now and in the future?”

The list, which is based on an eight-year study, used a unique methodology to calculate the companies that made the final cut. Rather than ask executives to vote on which companies should appear, factors such as financial performance, investors’ bids on stock prices and expectations of future results (new products, services, markets) determined the companies on the list.

Tech giants such as Apple, Amazon, Google, Oracle, Intuit and Salesforce were on the list, as well as consumer facing companies Starbucks, PepsiCo and Hershey.  One sector without a large presence on this list: financial institutions. You can view the complete list here.

As the Banking.com staff read through the list, we wondered, why aren’t there more financial institutions on this list? What are your thoughts? Leave us a message in the comments section below.