It seems that banks have been taking a battering in the current post-recession climate as a potentially fatal cocktail of uncertainly arising from the European debt crisis and continued volatility domestically continues to push banks to the limit.
Some banks, like Bank of America, continue to deal with losses due to mortgage-backed securities. B of A’s recent fortunes have largely been tied to its 2008 purchase of home lender Countrywide, prompting new CEO Brian Moynihan to take sizable steps as he attempts to restructure and rebuild the image of the nation’s largest bank.
Even investment bank Goldman Sachs, once thought to be impervious to the elements that have traditionally given other banks fits, has been hit hard by losses as of late. According to DealBook, Goldman, “weighed down by problems in its private equity portfolio and the broader global economic woes, reported a loss of $428 million, compared with a $1.7 billion profit a year ago.” Underscoring the magnitude of the loss, it was only the second time since the company went public in 1999 that Goldman suffered a loss.
It’s unclear whether banks will be able to collectively rebound from the malaise currently engulfing them, but their progress—or lack thereof—in doing so may be an important indicator as to whether the economy as a whole is righting itself or still teetering precariously close to yet another downturn.