Worried about Foreclosure Gate?
You should be.
Three years after the U.S. housing meltdown, after mega-writedowns and bailouts, many of the largest banks are still buried in bad mortgages.
A new report by Florida-based bank analyst Martin Weiss shows that JPMorgan Chase, Wells Fargo and Bank of America each have at least $20-billion (U.S.) in single-family home mortgages that are in foreclosure proceedings.
The tally: $21.7-billion for JPMorgan Chase, $20.5-billion for Wells Fargo and $20.3-billion for Bank of America. Each has tens of billions more in past-due mortgages. Bank of America leads the pack with nearly $75-billion worth of mortgages either in foreclosure or at least 30 days past due.
“These figures tell us the biggest players are not only in deep, but could sink even deeper into the mortgage mayhem,” Mr. Weiss says.
Measured a s a percentage of banks’ Tier 1 capital, Mr. Weiss gives most of the banks a D, or “weak” rating for their portfolios of bad mortgages. Foreclosed or past due mortgages equal 75.4 per cent of Tier 1 capital at Wells Fargo. JPMorgan Chase, Bank of America, Sun Trust and U.S. all have ratios of 50 to 60 per cent.
On the other hand, some previously troubled banks, such as Citibank are doing much better. It has just $6.3-billion in mortgages in various stages of foreclosure, according to Mr. Weiss’ report.
