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Source: istock

Bank Stocks Fall After Money-Laundering Allegations

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On Sept. 21, banking stocks came under pressure. According to reports, global banks were involved in moving suspicious funds over the last two decades despite warnings from U.S. officials. Shares of JPMorgan Chase fell 3.1 percent, Deutsche Bank fell 8.3 percent, HSBC fell 5.6 percent, Goldman Sachs fell 0.4 percent, and Bank of America fell 2.9 percent.

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Source: istock

Why did European bank stocks fall?

The sell-off in banking stocks on Sept. 21 was triggered by a new report published by BuzzFeed and the International Consortium of Investigative Journalists. The report was based on suspicious activity reports submitted by the banks to the U.S. Treasury. The BuzzFeed report highlighted that several global banks were involved in moving about $2 trillion worth of suspicious funds between 1999 and 2017.

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Europe’s top banks like Deutsche Bank, Barclays, HSBC Holdings, and Standard Chartered were all named in the report. Several U.S. bank names like BNY Mellon were also mentioned. Deutsche Bank facilitated about $1.3 trillion of the suspicious transactions, while JPMorgan Chase disclosed $514 billion, according to the report published over the weekend.

Why Are Bank Stocks Down?
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What is Deutsche Bank's stock price today?

Deutsche Bank stock was down about 1.1 percent at $8.25 in pre-market trading on Sept. 22. The stock fell 8.3 percent on Sept. 21 and closed at $8.34 with a market capitalization of $17.1 billion.

What is HSBC's stock price today?

HSBC stock was down about 0.7 percent at $18.50 in pre-market trading on Sept. 22. The stock fell 5.5 percent on Sept. 21 and closed at $18.64 with a market capitalization of $75.9 billion. HSBC stock has fallen to its lowest level since 1995.

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What is Bank of America's stock price today?

Bank of America stock was down about 0.2 percent at $24.42 in pre-market trading on Sept. 22. The stock fell 2.9 percent on Sept. 21 and closed at $24.47 with a market capitalization of $212.0 billion.

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What is Goldman Sachs's stock price today?

Goldman Sachs stock was up about 0.3 percent at $194.50 in pre-market trading on Sept. 22. The stock fell 0.4 percent on Sept. 21 and closed at $194.00 with a market capitalization of $66.8 billion.

Should you buy bank stocks now?

The next several quarters will likely be challenging for the banks. Their asset quality probably won't improve in the short term due to the coronavirus pandemic. As a result, long-term investors should wait for the right price to buy bank stocks.

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