Selling Spreads Across U.S. Regional Banks

* See UPDATES below...

Further to numerous articles that I've recently posted describing the collapse of several Regional Banks, the number of shareholders divesting themselves of shares in other Regional Banks is accelerating.

The following graphic contains a list of the top 10 holdings of the Regional Banking ETF, KRE. All of them are down, so far, today.

Source: TipRanks

KRE has continued its plunge down to the 2020 COVID-19 pandemic median price zone, as shown on the following monthly chart.

Inasmuch as it represents a snapshot of overall sentiment in the regional banks, I'd say the current state of these banks, in general, is pretty weak.

No one should be surprised that this particular sector of banks is weak, inasmuch as I warned about the state of U.S. banks, in general, in my post of April 10, 2021. As it happens at that time, KRE was close to making its all-time high of 78.81 (set in January of 2022), before it began to drop.

Even though its drop was initially choppy, it's been falling off a cliff since March of this year.

It's trading in a large sideways 'Chaos Zone.' It's had difficulty holding onto and increasing its gains made above 30.00 since January of 2013. It's also trading below its IPO opening price of 48.09 made in June of 2006...right before the 2007/08 Financial Crisis.

I anticipate that KRE will bounce around within that 'Chaos Zone' for some time. However, a drop and hold below 30.00 would signal much more serious consequences for the entire banking system, not only in the U.S., but globally, as well...as occurred in 2007/08/09.

N.B. Given these facts, it's odd that Fed Chairman J. Powell still insists that these banks are secure, when their representative ETF is plainly portraying great weakness...below that leading up to the 07/08 Financial Crisis! 

Surely one has to wonder if that contagion will spread to the larger banks and the 29 banks deemed too-big-to-fail by the Financial Stability Board of the G20 in 2011. Note that Credit Suisse did, subsequently, fail, as described in my recent posts.

Today's ZeroHedge article has some answers in that regard.

Source: ZeroHedge

* UPDATE May 5...

And...(lots of) food for thought...(HINT: keep your money safe!)...

Source: ZeroHedge

Source: ZeroHedge

Source: ZeroHedge

(Editor's Note: SATIRE 😏)

Source: ZeroHedge

* UPDATE May 6...

"It's spooky. Thousands of banks are underwater.

Let's not pretend that this is just about Silicon Valley Bank and First Republic. A lot of the US banking system is potentially insolvent."

Source: ZeroHedge

First Republic Bank Joins Other U.S. Bank Failures

First Republic Bank (FRC) is the latest bank failure in the U.S. It follows bank weakness that's been exposed in the U.S. and Europe the past few days, as outlined in my posts here and here.

It seems that "top executives at the bank sold millions of dollars of company stock in the last two months (averaging just below $130 a share)...but did not report the sales to the SEC."

FRC made a high of 222.86 in November of 2021, before dropping over the ensuing months, and finally plummeting this month.

Today, it gapped down on the open and hit a low of 17.53 before bouncing a bit, so far, as shown on the following monthly chart.

The following ZeroHedge article provides details involved in its demise.

Source: ZeroHedge

What more can I say? The banking and financial fallout continues -- not just in the U.S. -- as there are cracks and fragilities in the financial system globally.

But, I do have one question...Why would other financial or government institutions waste money by propping up bad banks, rather than concentrating on shoring up those that still have sound financial and fiscal security principles, as well as fiduciary and moral responsibilities, as their primary goal for their customers and investors? 👀

By the way, Silicon Valley Bank, Signature Bank, Silvergate Bank and First Republic Bank are NOT on the G20's list of 29 Banks Deemed Too Big To Fail. So, why are they getting "bailed out?"

Source: SBMS Blog

* UPDATE April 25...

The deposit outflow carnage continues as FRC is now trading at record lows, below its December 2010 IPO price of $27.25...looks like the $30 Billion infusion from other banks was a bust...

Source: ZeroHedge

Source: ZeroHedge

* UPDATE April 26...

FRC still dropping...like a rock...down 97%+ from November 2021 highs...

HOW CAN BANKS GET IT SO WRONG...AGAIN (POST-2008/09 FINANCIAL CRISIS)???

* UPDATE April 28...

FRC is still falling off a cliff and on its way to zero...reports are that the FDIC may step in and place it into receivership imminently.

So, what will happen to the top executives who sold millions of dollars of shares without reporting it to the SEC, as mentioned at the top of my post?

Source: ZeroHedge

* UPDATE May 1...

FRC has been scooped up by JP Morgan Bank from the FDIC.

Is this the beginning of the end of smaller community and regional banks across America?

If so, what does that mean for small and local businesses? Will they still be around in 5 or 10 years?

Source: ZeroHedge