Salient to Investors:

Michael Price at MFP Investors said five of the six biggest U.S. banks are selling at or below tangible book value, meaning the pieces are worth more than the whole, including some wonderful assets.

Bank of America has traded below book value since 2009, Citigroup since 2010.

Ken Fisher at Fisher Investments, underweight bank stocks for 3 years, is unclear why a bank needs to be in lots of financial services that aren’t banking. Fisher said the inherent nature of many CEOs is to love empire building.

David Trone at JMP Securities said the universal bank model is broken, while JPMorgan and Citigroup would be worth more broken up. New regulatory constraints will become even tighter after the JPMorgan trading loss – Trone says the biggest U.S. banks are un-investable because of new regulation and risks from the European sovereign-debt crisis.

Corporate raiders or potential takeovers don’t provide the same impetus for banks as they do in other industries due to laws that prohibit non-financial firms from buying lenders, and banks can’t make purchases that give them more than 10 percent of U.S. deposits.

Price, Trone and others say new regulatory burdens are core threats to bank profitability. Marc Lasry at Avenue Capital Group said banks will have a difficult time making money. Davide Serra at Algebris Investments said the universal bank model has through time been the winning one.

David Ellison at FBR Fund Advisors said high compensation for bank CEOs and their boards of directors makes them resistant to change. Professor Amar Bhide at Tufts University said bank managements and boards are protected from market forces – regulators won’t permit LBOs and the largest U.S. lenders are too large to be candidates for LBOs.

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