iShares U.S. Regional Banks ETF (ARCA: IAT)

iShares U.S. Regional Banks ETF (ARCA:IAT), Trade Ideas

iShares U.S. Regional Banks ETF

Charlotte,,North,Carolina,,Usa,-,January,15,,2020:,Us,Bank

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iShares Dow Jones US Regional Banks Index Fund

U.S. Bancorp reported a decline in revenue and net interest income for Q1 2024, but beat adjusted earnings expectations. FY24 guidance was also lowered. 

Why U.S. Bancorp Shares Are Diving Premarket Today

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PNC reported lower Q1 FY24 results, with revenue declining 8% Y/Y. Net interest income fell 9% while noninterest income decreased 7%. Adjusted EPS was $3.36, above consensus. 

What&#39;s Going On With PNC Financial Shares Today?

MTB WC

M&amp;T Bank reported Q1 FY24 results with revenue of $2.26B, net interest income down 8%, net income below last year, and EPS in line with consensus.

Why M&amp;T Bank Shares Are Trading Higher Today

U.S. Bancorp&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/USB#NYSE">USB</a>) shares are trading lower after&nbsp;<a target="_blank" href="https://www.benzinga.com/pressreleases/24/04/b38287687/u-s-bancorp-reports-first-quarter-2024-results" rel="noreferrer noopener">it reported first-quarter FY24 results</a>.
Revenue stood at $6.7 billion (-6.4% Y/Y), which aligns with the consensus. Net interest income (taxable-equivalent basis) fell 14.0% Y/Y to $4.0 billion due to the impact of higher interest rates on deposit mix and pricing.
Meanwhile, Non-interest income rose 7.7% Y/Y to $2.7 billion, aided by higher fee revenue across most categories.&nbsp;
The net interest margin was 2.70%, compared with 3.10% in the year-ago period. Adjusted earnings per share totaled $0.90, beating the <a href="https://www.benzinga.com/calendars/earnings" target="_blank" rel="noreferrer noopener">consensus of $0.88</a>.
The provision for credit losses for the first quarter of 2024 was $553 million, up 29.5% Y/Y, due to normalization in the credit environment.
The company recorded an average total loan decline of 0.5% Y/Y and an average total deposit growth of 0.1% on a linked quarter basis. The company reported a CET1 capital ratio of 10.0% as of March 31, 2024, compared with 9.9% on December 31, 2023.
Andy Cecere, Chairman, President and CEO said, &#8220;Diluted earnings per share of $0.90, as adjusted, excluded $(0.12) of notable items that included the last of our merger and integration-related charges related to the acquisition of MUFG Union Bank and an anticipated increase in the FDIC special assessment.&#8221;
&#8220;Our results benefited from good growth across our fee businesses driven by strong underlying client growth and activity, as well as prudent expense management. Despite a challenging interest rate environment and pressure on industry deposit levels, we again saw growth in consumer deposits during the quarter.&#8221;
Outlook: USB cut FY24 net interest income (taxable-equivalent basis) guidance to $16.1 billion-$16.4 billion from the&nbsp;<a target="_blank" href="https://www.benzinga.com/calendars/guidance" rel="noreferrer noopener">previously expected $16.6 billion+.</a>
For the second quarter, USB expects net interest income (taxable-equivalent basis) to be relatively stable sequentially.
Also Read:&nbsp;<a target="_blank" href="https://www.benzinga.com/markets/equities/24/03/37992797/banks-will-shine-in-2025-analyst-says-but-can-they-dodge-loan-losses" rel="noreferrer noopener">Banks Will Shine In 2025, Analyst Says, But Can They Dodge Loan Losses?</a>
Investors can gain exposure to the stock via&nbsp;IShares U.S. Regional Banks ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IAT#NYSE">IAT</a>) and&nbsp;First Trust Nasdaq Bank ETF&nbsp;(NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/FTXO#NASDAQ">FTXO</a>).
Price Action: USB shares are trading lower by 3.05% to $39.75 premarket on the last check Wednesday. 
Photo by JHVEPhoto via Shutterstock

PNC Financial Services Group Inc&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/PNC#NYSE">PNC</a>) shares are trading lower after it reported&nbsp;<a target="_blank" href="https://www.benzinga.com/pressreleases/24/04/n38265700/pnc-reports-first-quarter-2024-net-income-of-1-3-billion-3-10-diluted-eps-or-3-36-excluding-a-130-" rel="noreferrer noopener">first-quarter FY24 results</a>.
The bank reported a revenue decline of 8% Y/Y to $5.15 billion, missing the consensus of $5.19 billion. Revenue declined Y/Y due to lower net interest income and noninterest income.&nbsp;
Net interest income fell 9% Y/Y to $3.26 billion, with a net interest margin declining to 2.57% from 2.84% prior year quarter.
Noninterest income decreased 7% Y/Y to $1.88 billion due to a decline in capital markets and advisory revenue, fee income, and residential and commercial mortgage businesses.
Average loans fell 2% Y/Y, and average deposits decreased 4% Y/Y in the first quarter. Adjusted EPS of $3.36 came <a href="https://www.benzinga.com/calendars/earnings" target="_blank" rel="noreferrer noopener">above the consensus of $3.02</a>.
The company reported a provision for credit losses of $155 million in the quarter (vs. $235 million a year ago), reflecting portfolio activity and improved macroeconomic factors. CET1 capital ratio stood at 10.1% vs. 9.2% in the prior year quarter. 
Dividend: On April 3, PNC&#8217;s board of directors declared a quarterly cash dividend per share of $1.55, payable on May 6, 2024, to shareholders of&nbsp;<a target="_blank" href="https://www.benzinga.com//node/38072433" rel="noreferrer noopener">record as of April 15, 2024.</a>
PNC returned $0.8 billion of capital to shareholders, comprising share repurchases over $0.1 billion in the quarter.
Bill Demchak, Chairman and CEO, said, &#8220;PNC delivered solid first quarter results generating net income of $1.3 billion which included an additional $130 million pre-tax FDIC special assessment. During the quarter, we grew customers, reduced expenses, increased spot deposits, maintained stable credit quality and continued to build upon our strong liquidity and capital positions.&#8221;
Investors can gain exposure to the stock via&nbsp;IShares U.S. Regional Banks ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IAT#NYSE">IAT</a>) and&nbsp;Invesco Exchange-Traded Fund Trust II Invesco S&amp;P Ultra Dividend Revenue ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/RDIV#NYSE">RDIV</a>).
Guidance: For FY24, PNC continues to <a href="https://d1io3yog0oux5.cloudfront.net/_4dd30b1093d2402ec5f5c10de4b909bf/pnc/db/2250/21495/presentation/1Q24+Earnings+Slides_Final.pdf">expect </a>revenue to be stable to down 2%, with net interest income declining 4% – 5% Y/Y.
The bank expects revenues to be stable and net interest income to be&nbsp;<a target="_blank" href="https://www.benzinga.com/calendars/guidance" rel="noreferrer noopener">down 1% on a sequential basis in the second quarter of FY24</a>.
Price Action: PNC shares are down 1.88% at $146.75 premarket on the last check Tuesday.
Photo via Wikimedia Commons

What's Going On With PNC Financial Shares Today?

M&amp;T Bank Corporation&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/MTB#NYSE">MTB</a>) shares are trading higher after it reported&nbsp;<a target="_blank" href="https://www.benzinga.com/pressreleases/24/04/n38243902/m-t-bank-corporation-nyse-mtb-announces-first-quarter-2024-results" rel="noreferrer noopener">first-quarter FY24 results</a>.
Revenue of $2.260 billion, slightly missing the consensus of $2.263 billion. Net interest income expressed on a taxable-equivalent basis was $1.69 billion, down 8% Y/Y.
Noninterest income totaled $580 million, slightly lower than $587 million in the year-earlier quarter, with the net interest margin contracting to 3.52% vs 4.04% a year ago.
Net income of $531 million came below $702 million a year ago. EPS was $3.09,&nbsp;<a target="_blank" href="https://www.benzinga.com/calendars/earnings" rel="noreferrer noopener">which came in line with the consensus</a>.
M&amp;T&#8217;s efficiency ratio was 60.8% compared to 55.5% in the year-earlier quarter. M&amp;T recorded a provision for credit losses of $200 million, higher than $120 million in the year-earlier quarter, reflecting elevated levels of criticized commercial and industrial loans and loan growth.
The allowance for credit losses totaled $2.19 billion or 1.62% of loans outstanding as of March 31, 2024, compared with $1.975 billion or 1.49% of loans outstanding in Q1 FY23.
M&amp;T held total assets of $211.5 billion as of March 31, 2024. Loans and leases, net of unearned discount, were $133.8 billion. The CET1 capital ratio was estimated at 11.07% as of March 31, 2024. 
Daryl N. Bible, M&amp;T&#8217;s Chief Financial Officer, said,&nbsp;&#8220;We are off to a solid start in 2024 as we were able to grow certain sectors of our commercial and consumer loan portfolios, while continuing to shrink our commercial real estate exposure. Expenses were prudently managed in the recent quarter and our selective approach to allocating resources to our strategic priorities with utmost care has not wavered.&#8221;&nbsp;
&#8220;M&amp;T&#8217;s liquidity and capital position strengthened, reflecting a stable deposit base, higher levels of borrowings and solid earnings after considering seasonal employee compensation expenses and an incremental FDIC special assessment.&#8221;
Investors can gain exposure to the stock via&nbsp;IShares U.S. Regional Banks ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IAT#NYSE">IAT</a>) and&nbsp;SPDR S&amp;P Regional Banking ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KRE#NYSE">KRE</a>).
Also Read:&nbsp;<a target="_blank" href="https://www.benzinga.com/news/earnings/24/04/38242372/m-t-bank-earnings-are-imminent-these-most-accurate-analysts-revise-forecasts-ahead-of-earnings-call" rel="noreferrer noopener">M&amp;T Bank Earnings Are Imminent; These Most Accurate Analysts Revise Forecasts Ahead Of Earnings Call</a>
Price Action: MTB shares are up 2.94% at $138.51 premarket on the last check Monday.
Photo via Wikimedia Commons

Why M&T Bank Shares Are Trading Higher Today

Huntington Bancshares Incorporated&nbsp;(NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/HBAN#NASDAQ">HBAN</a>) shares are trading higher today.&nbsp;BofA Securities&nbsp;analyst Ebrahim H. Poonawala upgraded the stock to Buy (from Neutral) and raised the&nbsp;<a target="_blank" href="https://www.benzinga.com/quote/HBAN/analyst-ratings" rel="noreferrer noopener">price target to $16 (from $14)</a>.
The analyst says that Huntington Bancshares is well-positioned to navigate multiple macroeconomic outcomes.
Moreover, franchise investments, footprint, and solid execution is expected to drive an acceleration in revenue growth into 2025, writes the analyst. The analyst says fewer rate cuts are positive, with a potential for FY24 net interest income (NII) to remain flat.&nbsp;
In particular, the analyst predicts near-term growth in auto floor plan/inventory finance (Q1 seasonally strong) to provide defensibility and forecasts revenue growth accelerating to +8.4% FY25 (vs. +3.7% peer median).
The analyst writes that $13 billion-15 billion in fixed-rate loan repricing should serve as a tailwind to NII growth in FY24/FY25.&nbsp;
Poonawala revised the EPS estimates by 4% to $1.20 for FY24, 15% to $1.44 for FY25, and 14% to $1.55 for FY26 thanks to higher NII.&nbsp;
In January 2024, Huntington Bancshares reported a 10% Y/Y decline in fourth-quarter FY23 net interest income, and CEO Steve Steinour expressed optimism for 2024, highlighting attractive growth prospects and&nbsp;<a target="_blank" href="https://www.benzinga.com/news/earnings/24/01/36697126/huntington-ceo-upbeat-on-2024-prospects-despite-missing-q4-revenue-estimates-projects-attractive-gr" rel="noreferrer noopener">potential acceleration in loan growth</a>.
Investors can gain exposure to the stock via&nbsp;IShares U.S. Regional Banks ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IAT#NYSE">IAT</a>) and&nbsp;SPDR S&amp;P Regional Banking ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KRE#NYSE">KRE</a>).
Price Action: HBAN shares are up 2.83% at $13.98 on the last check Monday.
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Huntington Bancshares Gets Bullish Upgrade, Analyst Forecasts Accelerated Growth Despite Rate Worries

In a balanced portfolio, there&#8217;s always a chance of some investments underperforming. While backing losers isn&#8217;t ideal, there&#8217;s a way to ease the pain when it comes to year-end taxes.
Tax-loss harvesting&nbsp;is a strategy whereby portfolio losses can be offset against taxes on capital gains owed when you sell assets at a profit. If the losses exceed the profits, one can also offset taxes on other capital gains, like those from property or business sales.
Additionally, these losses can be employed to offset taxes on ordinary income — up to $3,000 a year in total can be offset this way — and losses not recovered in one year can be carried forward into subsequent years.
Also Read: <a href="https://www.benzinga.com/markets/equities/23/12/36325391/magnificent-7-widens-gap-with-rest-of-s-p-500-but-that-may-change-in-2024">&#8216;Magnificent 7&#8217; Widens Gap With Rest Of S&amp;P 500, But That May Change In 2024</a>
<h2 class="wp-block-heading">How Does Tax-Loss Harvesting Work</h2>
The capital gains you pay on profitable trades depend on how long you&#8217;ve held the assets. For positions held for more than one year, the rates are either 0%, 15% or 20%, depending on your taxable income. If you&#8217;ve held the positions for less than a year, your profits will be taxed at your normal income rate.
That&#8217;s 37% at the federal rate — more in some higher-tax states such as New York and California.
The rules on tax-loss harvesting, however, don&#8217;t allow for investors to take a taxable loss in an asset and then repurchase the same position straight back.
To get around this so-called &#8220;wash-sale&#8221; rule, tax lawyers interviewed by Bloomberg suggest replacing the sold asset with something with a different risk profile.
For example, Bloomberg suggests that if you sold out of your position in the SPDR S&amp;P Regional Banking ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KRE#NYSE">KRE</a>), which is down 10.78% this year, you could buy the iShares US Regional Banks ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IAT#NYSE">IAT</a>), which is down 12.68%.
So, as we come to the end of the year, investors should be busy assessing their portfolios to figure out how best they can use this strategy to offset their tax bills. It&#8217;s worth $3,000, so get those calculators out.
Now Read: <a href="https://www.benzinga.com/analyst-ratings/analyst-color/23/12/36309797/goldilocks-2024-investors-increasingly-optimistic-on-profits-outlook-for-next-year">Goldilocks 2024: Investors Increasingly Optimistic On Profits Outlook For Next Year</a>

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Year-End Planning: How To Make Winnings Out Of Losses Using Tax-Loss Harvesting

Mina Khattak, senior director crypto and Web3 at Worldpay, recalled at <a href="https://www.benzinga.com/events/digital-assets/">Benzinga&#8217;s Future of Digital Assets</a> event how FTX was in her company&#8217;s boarding process, but was not approved. 
<a href="https://www.benzinga.com/markets/cryptocurrency/23/11/35778694/exclusive-crypto-world-pivots-beyond-bankman-fried-era-in-wake-of-ftx-scandal">That lucky sidestep</a> underscores the importance of implementing extensive checks and due diligence, including know-your-customer (KYC) and anti-money laundering (AML) protocols. 
&#8220;The ability for Web2 companies and traditional financial services companies to start offering these services is going to make consumers a little more comfortable and giving them payment methods to acquire crypto is also going to facilitate onboarding — by layering all of those many steps with a trusted brand will help onboard users at scale,&#8221; she said.
See Also: <a href="https://www.benzinga.com/markets/cryptocurrency/23/11/35829273/exclusive-ripples-brendan-berry-on-2024-trends-why-cryptos-second-wave-is-all-about-utilit">Ripple&#8217;s Brendan Berry On 2024 Trends, Why Crypto&#8217;s &#8216;Second Wave&#8217; Is All About Utility</a>
Getting retail banks involved in the transaction of cryptocurrency would be a major step toward getting more investors to trade the asset class and, eventually, move forward to mass adoption, Khattak and other panelists explained.
An onslaught of fraudsters, hacks, scams and blunders saw millions of dollars worth of Bitcoin (<a href="https://www.benzinga.com/quote/BTC-USD">$BTC</a>) and other assets disappear in recent years: Onboarders of potential cryptocurrency traders are in the difficult position of rebuilding trust.
Eric Parker, co-founder of cryptocurrency wallet app Giddy, said that increasing adoption of crypto boils down to getting money onto the blockchain and keeping it safe while it&#8217;s there.
&#8220;You have to ask what are the use cases to make people willing to take money out of their savings accounts and be willing to put it on the blockchain,&#8221; he said. 
&#8220;It&#8217;s not that different to the 1990s when people started offering retail services over the internet and in a world of higher inflation and traditional markets that offer limited yield, decentralized finance is an escape from a system that is failing people,&#8221; he added.
Now Read: <a href="https://www.benzinga.com/markets/cryptocurrency/23/11/35848352/bitcoin-must-maintain-30k-support-to-avoid-major-sell-off-glassnode-warns">Bitcoin Must Maintain $30K Support To Avoid Major Sell-Off, Glassnode Warns</a>

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EXCLUSIVE: Why Traditional Banks Could Play A Major Role In Crypto Mass Adoption

Legendary investor, fund manager and PIMCO co-founder Bill Gross sees extraordinary long-term value in regional banks.
In a <a href="https://twitter.com/real_bill_gross/status/1719010907806904452">tweet</a> posted on Oct. 30, Gross said he sees regional bank stocks as a &#8220;falling knife&#8221; that &#8220;<a href="https://www.benzinga.com/topic/regional-banks">hasn't hit ground yet</a>&#8220;.
Back in <a href="https://www.marketwatch.com/story/pimco-co-founder-bill-gross-says-hes-bought-regional-bank-stocks-c8b4ba43">April</a>, the Bond King had bought four beaten-down regional bank stocks trading at 60% to book value:
<ul>
<li>Western Alliance Bancorp. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/WAL#NYSE">WAL</a>)</li>
<li>Synovus Financial Corp. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SNV#NYSE">SNV</a>)</li>
<li>PacWest Bancorp (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/PACW#NYSE">PACW</a>)</li>
<li>SPDR S&amp;P Regional Banking ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KRE#NYSE">KRE</a>)</li>
</ul>
Gross sold off 80% of that holding in <a href="https://twitter.com/real_bill_gross/status/1684246743133851649">July</a> making &#8220;mucho bucks&#8221; on them.
The billionaire has again indicated an appetite for regional banks, saying he would be &#8220;waiting just a little bit more to own some of these at 60% book and 7% yields.&#8221;
Also Read: <a href="https://www.benzinga.com/23/09/34330117/regional-banks-navigating-a-goldilocks-scenario-amid-market-geopolitical-challenges">Regional Banks: Navigating A Goldilocks Scenario Amid Market &amp; Geopolitical Challenges</a>
We highlight three regional bank ETFs that you could keep on your watch list and consider when they touch bottom:
<h2 class="wp-block-heading">The SPDR S&amp;P Regional Banking ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KRE#NYSE">KRE</a>)</h2>
Trading since 2006, the SPDR S&amp;P Regional Banking ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KRE#NYSE">KRE</a>) tracks the performance of the S&amp;P Regional Banks Select Industry Index. The fund has an expense ratio of 0.35% and has 49.76% of its portfolio invested in mid-cap regional banks, which large caps commanding a 12.2%. Small-cap regional bank stocks command a good 33.69% of this fund&#8217;s portfolio:
<figure class="wp-block-table"> 
<table>
<thead>
<tr>
<th>Symbol</th>
<th>Holding</th>
<th>% Assets</th>
</tr>
</thead>
<tbody>
<tr>
<td>TFC</td>
<td>Truist Financial Corporation</td>
<td>3.26%</td>
</tr>
<tr>
<td>MTB</td>
<td>M&amp;T Bank Corporation</td>
<td>3.16%</td>
</tr>
<tr>
<td>FHN</td>
<td>First Horizon Corporation</td>
<td>3.07%</td>
</tr>
</tbody>
</table>
<figcaption class="wp-element-caption">Source: VettaFi</figcaption></figure>
KRE is down about 32% for the year, trading at $39.64. The ETF has 52-week low of $34.52. 
<h2 class="wp-block-heading">The iShares U.S. Regional Banks ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IAT#NYSE">IAT</a>)</h2>
Launched in 2006, the iShares U.S. Regional Banks ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IAT#NYSE">IAT</a>) tracks the performance of the Dow Jones U.S. Select Regional Banks Index. The fund has an expense ratio of 0.40% and has 61.14% of its portfolio invested in large-cap regional banks, which mid-caps coming in next at 38.71%.
Top three holdings of the fund include:
<figure class="wp-block-table"> 
<table>
<thead>
<tr>
<th>Symbol</th>
<th>Holding</th>
<th>% Assets</th>
</tr>
</thead>
<tbody>
<tr>
<td>USB</td>
<td>U.S. Bancorp</td>
<td>14.28%</td>
</tr>
<tr>
<td>PNC</td>
<td>PNC Financial Services Group, Inc.</td>
<td>13.26%</td>
</tr>
<tr>
<td>TFC</td>
<td>Truist Financial Corporation</td>
<td>11.01%</td>
</tr>
</tbody>
</table>
<figcaption class="wp-element-caption">Source: VettaFi</figcaption></figure>
IAT is down about 34% for the year, trading at $31.65. The ETF has a 52-week low of $28.80.
<h2 class="wp-block-heading">The Invesco KBW Regional Banking ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KBWR#NYSE">KBWR</a>)</h2>
Trading since 2011, the Invesco KBW Regional Banking ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KBWR#NYSE">KBWR</a>) tracks the performance of the KBW&nbsp;Nasdaq Regional Banking Index. The fund has an expense ratio of 0.35% and has 54.68% of its portfolio invested in mid-cap regional banks, which large caps commanding a 45.26%.
Top three holdings of the fund include:
<figure class="wp-block-table"> 
<table>
<thead>
<tr>
<th>Symbol</th>
<th>Holding</th>
<th>% Assets</th>
</tr>
</thead>
<tbody>
<tr>
<td>WBS</td>
<td>Webster Financial Corporation</td>
<td>3.93%</td>
</tr>
<tr>
<td>CFR</td>
<td>Cullen/Frost Bankers, Inc.</td>
<td>3.88%</td>
</tr>
<tr>
<td>CBSH</td>
<td>Commerce Bancshares, Inc.</td>
<td>3.68%</td>
</tr>
</tbody>
</table>
<figcaption class="wp-element-caption">Source: VettaFi</figcaption></figure>
KBWR is down about 26% for the year, trading at 41.83. The ETF has a 52-week low of $37.49.
Read Next: <a href="https://www.benzinga.com/analyst-ratings/analyst-color/23/10/35243332/q3-earnings-season-starts-strong-for-banks-as-high-interest-rates-fuel-profits-bona">Q3 Earnings Season Starts Strong For Banks As High Interest Rates Fuel Profits Bonanza</a>

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Bill Gross Sees 'Extraordinary Long-Term Value' in Regional Banks: 3 ETFs To Watch

Bank stocks have been suffering since the <a href="https://www.benzinga.com/news/23/03/31356018/svb-financial-collapse-triggers-experts-fear-of-softbank-buyback-alibaba-mark-down-arm-ipo-valuation">collapse last week of </a><a href="https://www.benzinga.com/news/23/03/31356018/svb-financial-collapse-triggers-experts-fear-of-softbank-buyback-alibaba-mark-down-arm-ipo-valuation">SVB Financial Group</a> (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/SIVB#NASDAQ">SIVB</a>), also known as Silicon Valley Bank.
The entire banking sector became affected by the fall of America's 16th largest lender.&nbsp;
While the impact is global, the U.S. banking sector continues to receive hits from the aftermath of the SVB's fallout, as investors pull their money away from the sector and depositors pull their funds in an effort to avoid further risk.
Shares of Credit Suisse (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CS#NYSE">CS</a>), one of Europe's "too big to fail" banks, <a href="https://www.benzinga.com/news/23/03/31357630/credit-suisse-plunges-hard-putting-market-rally-at-risk-whats-going-on-with-the-swiss-bank">dropped almost 25% on Wednesday</a>. Other European banks, such as the French Societe Generale and BNP Paribas have also been hardly affected by the collapse.
Read Also: <a href="https://www.benzinga.com/news/23/03/31360766/silicon-valley-bank-creditors-purchased-bonds-at-distressed-levels-anticipating-potential-bankruptcy">Silicon Valley Bank Creditors Purchased Bonds At Distressed Levels Anticipating Potential Bankruptcy Sale</a>
<h3>Regional Banks</h3>
The SVB collapse is sending shockwaves across the U.S.&nbsp;
First Republic Bank (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FRC#NYSE">FRC</a>) has been first in the line of fire. The San Francisco-based firm lost 70% of its value this week and 22% on Wednesday alone.
Several analyst firms including Compass Point, Raymond James and Wolfe Research have downgraded the stock since Monday. On Wednesday, the bank's credit rating was downgraded to from A- to BB+, a junk rating by S&amp;P.
Another regional bank, Salt Lake City-based Zions Bankcorporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/ZION#NASDAQ">ZION</a>), lost 33% of its value this week and an additional 1.7% On Wednesday.
Cleveland-based KeyCorp (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KEY#NYSE">KEY</a>) was down 6% Wednesday and 33% in one week.
PacWest Bancorp (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/PACW#NASDAQ">PACW</a>) was down 20% on Wednesday and almost 60% in one week.
iShares US Regional Banks ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IAT#NYSE">IAT</a>), an ETF focused on regional U.S. banks, lost 3% on Wednesday and almost 25% in one week.
<h3>Big U.S Banks</h3>
The SVB blow also reached the country's largest banking institutions. KBW Bank Index, a benchmark for the banking sector, is down 21% in the past week and 4.7% on Wednesday alone. The index tracks the 24 largest lending banks and thrifts.
Citigroup Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/C#NYSE">C</a>) is down 12% this week and 5.8% on Wednesday.
JPMorgan Chase &amp; Co (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/JPM#NYSE">JPM</a>) dropped 4.8% on Wednesday.
Wells Fargo &amp; Co (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/WFC#NYSE">WFC</a>) lost 4% on Wednesday to a total of 11% this week.
Charles Schwab Corporation (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHW#NYSE">SCHW</a>), one of the worst-affected large U.S. banks of the crisis, recovered 4% of its value on Wednesday after a 20% drop this week.
Bank of America Corp (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BAC#NYSE">BAC</a>) is down 2.1% on Wednesday and 12.8% this week.
Photo by Etienne Martin on Unsplash.

SCHW

SIVB

ZION

Regional, Big U.S. And Global Banks Shake From SVB Collapse On Wednesday

The collapse of Silicon Valley Bank (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/sivb#NASDAQ">SIVB</a>) last week has sent the banking sector into a spiral, with the government stepping in to help backstop depositors. The news has regional banking stocks trading down significantly on Monday. Here&rsquo;s what you need to know and the major movers.
What Happened: The California Department of Financial Protection and Innovation closed Silicon Valley Bank and named the Federal Deposit Insurance Corporation (FDIC) as the <a href="https://www.benzinga.com/government/23/03/31299908/fdic-shuts-down-silicon-valley-bank-here-are-the-details">bank&rsquo;s receiver on Friday.</a>
The move came after the 16th largest bank in the United States struggled to raise additional funding and saw huge outflows of deposits on Thursday.
The Federal Reserve Board <a href="https://www.benzinga.com/markets/cryptocurrency/23/03/31311948/bailout-feds-rescue-depositors-amid-svb-bank-collapse">announced funding to backstop </a>the struggling bank with the Bank Term Funding Program. The funding will support depositors of the bank and businesses who held deposits with SVB Financial.
Over the weekend, U.S. regulators<a href="https://www.benzinga.com/government/23/03/31311974/signature-bank-closed-by-regulators-fed-announces-backstop-to-safeguard-depositors"> shut down</a> Signature Bank (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/sbny#NASDAQ">SBNY</a>), which marked the third-largest bank failure of all time. The regulators made the move to protect depositors who were told they would have full access to their deposits.
&ldquo;The U.S. banking system remains resilient and on a solid foundation,&rdquo; the Fed said.
Signature Bank was previously<a href="https://www.benzinga.com/markets/cryptocurrency/23/03/31301740/short-seller-who-predicted-ftx-silvergate-capital-collapses-and-shorted-svb-financial-has-"> highlighted by a short seller </a>who had correctly called out issues from FTX, Silvergate Capital (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/si#NYSE">SI</a>) and Silicon Valley Bank.
On Monday morning, over a dozen banking stocks were down by 10% or more in the premarket. Here is a look at the biggest movers in the financial sector on Monday.
Related Link:&nbsp;<a href="https://www.benzinga.com/news/23/03/31312372/shuttered-signature-banks-deposits-substantial-assets-transferred-to-bridge-bank-by-fdic-what-you-sh">Shuttered Signature Bank&#39;s Deposits, Substantial Assets Transferred To Bridge Bank By FDIC: What You Should Know</a>
Western Alliance Bancorp (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/wal#NYSE">WAL</a>): -82%
First Republic Bank (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/frc#NYSE">FRC</a>): -70%
Customers Bancorp (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/cubi#NYSE">CUBI</a>): -56%
PacWest Bancorp (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/pacw#NASDAQ">PACW</a>): -53%
Metropolitan Bank Holding (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/mcb#NYSE">MCB</a>): -49%
Comerica Inc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/cma#NYSE">CMA</a>): -46%
East West Bancorp (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/ewbc#NASDAQ">EWBC</a>): -41%
KeyCorp (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/key#NYSE">KEY</a>): -34%
Zions Bancorp (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/zion#NASDAQ">ZION</a>): -28%
Bank of Hawaii (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/boh#NYSE">BOH</a>): -28%
Fifth Third Bancorp (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/fitb#NASDAQ">FITB</a>): -27%
First Horizon Corp (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/fhn#NYSE">FHN</a>): -22%
Huntington Bancshares (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/hban#NASDAQ">HBAN</a>): -20%
Truist Financial Corp (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/tfc#NYSE">TFC</a>): -20%
Charles Schwab Corp (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/schw#NYSE">SCHW</a>): -19%
Mercury Fintech Holding (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/mfh#NASDAQ">MFH</a>): -13%
Regions Financial (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/rf#NYSE">RF</a>): -13%
Citizens Financial Group (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/cfg#NYSE">CFG</a>): -12%
AmeriServ Financial (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/asrv#NASDAQ">ASRV</a>): -10%
Several of the bank stocks mentioned above have been halted to start the Monday trading session. Some of the banks have also released statements and updates on their liquidity concerns and exposures to other struggling banks.
ETFs with large exposure to regional banks are also seeing big declines Monday morning. The iShares US Regional Bank ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/iat#NYSE">IAT</a>) is down 17% at the time of writing. The Invesco KBW Bank ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/kbwb#NASDAQ">KBWB</a>) is down 14% on Monday.&nbsp;
Bloomberg <a href="https://finance.yahoo.com/news/us-regional-banks-remain-under-092829687.html">said </a>the Invesco KBW Bank ETF had $245 million in outflows recently, marking one of the largest exits in 2023.&nbsp;
Stay tuned to<a href="https://pro.benzinga.com/feature/newsfeed/?gspk=bHVrZWphY29iaTUzNDg&amp;gsxid=tdEE0VrK8Jeg&amp;ref=lukejacobi5348"> Benzinga Pro for all the latest headlines.</a>
Read Next:&nbsp;<a href="https://www.benzinga.com/news/23/03/31300370/watch-out-for-these-etfs-as-svb-financial-bleeds-today">Watch Out For These ETFs As SVB Financial Bleeds Today</a>

Penny Stocks

Small Cap

ASRV

CUBI

EWBC

FITB

KBWB

SBNY

Regional Bank Stocks Getting Crushed Monday: Here Are 19 Stocks Down 10% Or More

Shares of banking company&nbsp;SVB Financial Group&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/sivb#NASDAQ">SIVB</a>) plunged 60% on Thursday after it&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/trading-ideas/movers/23/03/31281510/why-svb-financial-stock-is-plummeting-today" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">shared plans to raise capital</a>.&nbsp;
SVB said it was seeking over $2 billion in additional funding. It planned to offer $1.25 billion of its common stock and $500 million of depositary shares registered as public offerings.&nbsp;
SVB also completed the plan to sell its available-for-sale securities portfolio. This transaction would result in an after-tax loss of $(1.8) billion in Q1 2023.
Additionally, SVB entered a private purchase subscription agreement with&nbsp;General Atlantic, a growth equity investor, to purchase $500 million of common stock at the public offering price. The company&#39;s CEO,&nbsp;Greg Becker, sent a letter citing higher interest rates and high cash burn from clients&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/analyst-ratings/analyst-color/23/03/31297188/with-svb-financial-group-on-life-support-analysts-downgrade-stock-too-much-uncertai" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">as reasons for the need for capital</a>.
The stock was halted during pre-market trading Friday at around 8:41 am ET for code news pending. Amid the trading halt, CNBC&#39;s David Faber reported the company&#39;s proposed capital raise has failed, with CNBC reporting SVB Financial&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/23/03/31295860/why-svb-financial-group-shares-are-getting-obliterated" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">is in talks to sell itself</a>.
Silicon Valley Bank&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/government/23/03/31299908/fdic-shuts-down-silicon-valley-bank-here-are-the-details" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">has now been closed</a>&nbsp;by&nbsp;Federal Deposit Insurance Corporation&nbsp;(FDIC). The news comes on the heels of SVB&#39;s parent company, SVB Financial Group,&nbsp;failing to&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/m-a/23/03/31298169/silicon-valley-bank-cant-raise-cash-opts-for-a-sale" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">raise cash to sustain operations</a>.
ETFs with significant exposure to the banking company include&nbsp;BlackRock ETF Trust, BlackRock Future Financial And Technology ETF&nbsp;(NYSE:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/bpay#NYSE" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">BPAY</a>),&nbsp;IShares U.S. Regional Banks ETF&nbsp;(NYSE:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/iat#NYSE" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">IAT</a>),&nbsp;Invesco KBW Bank ETF&nbsp;(NASDAQ:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/kbwb#NASDAQ" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">KBWB</a>). The ETFs have exposure to SIVB between 3%-4% of their total holdings.
The ETFs have lost 11%-18% last month, missing the Factset segment average.
BPAY traded lower by 5.01% at $20.58 on the last check Friday. IAT traded lower by 5.60% at $41.14, and KBWB traded lower by 3.78% at $47.54.
Read:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/etfs/specialty-etfs/23/03/31299793/exclusive-jim-cramer-recommended-svb-financial-in-february-an-example-of-his-reverse-midas-to" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">EXCLUSIVE: Jim Cramer Recommended SVB Financial In February, An Example Of &#39;His Reverse Midas Touch&#39;</a>
Price Action:&nbsp;SIVB shares traded lower by 62.8% at $39.49 on the last check Friday.

BlackRock ETF Trust BlackRock Future Financial and Technology ETF

BPAY

Watch Out For These ETFs As SVB Financial Bleeds Today

CNBC
<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/05/27365346/analysts-see-gpus-premium-cpus-pcs-cars-toys-consumer-electronics-get-costlier-as-tsmc-samsung-intel" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Analysts See Consumer Electronics Get Costlier As Major Chipmakers TSMC, Samsung, Intel Boost Prices</a>
<ul>
<li>Analysts suggested that products relying on semiconductors will likely get more costly as chip foundries prepare to increase their prices, CNBC reports.</li>
<li>Global semiconductor lead at Accenture Plc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/acn#NYSE">ACN</a>) saw the magnitude of any price increases depending upon the share of semiconductor cost in the overall product cost, the ability of manufacturers to cut costs in other areas, and the competitive landscape of each product category.</li>
<li>Products using more advanced chips like GPUs (graphics processing units) and high-end CPUs (central processing units) are likely to go up in price, unlike smartphones which saw reduced demand, Alam said.</li>
</ul>
<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/05/27364300/volkswagen-likely-to-overtake-tesla-on-ev-sales-by-2025-cnbc" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Who Can Beat Tesla On EV Sales? This Company CEO Believes So</a>
<ul>
<li>Volkswagen AG (OTC: <a class="ticker" href="https://www.benzinga.com/stock/vwagy#OTC">VWAGY</a>) CEO Herbert Diess said Volkswagen can overtake Tesla, Inc. (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/tsla#NASDAQ">TSLA</a>) as the world&rsquo;s largest seller of electric vehicles by 2025, CNBC reported.</li>
<li>Stabilizing supply chain woes would help the German carmaker to increase production in the coming months, the CEO said.</li>
<li>He expects some relief from the semiconductor supply market to occur in the middle of 2022.</li>
</ul>
<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/05/27355857/why-is-airbnb-exiting-the-chinese-domestic-market" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Why Is Airbnb Exiting The Chinese Domestic Market?</a>
<ul>
<li>Sources tell CNBC that Airbnb Inc (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/abnb#NASDAQ">ABNB</a>) is shutting down its domestic business in China.</li>
<li>According to two sources, the company plans to remove all of its listings in China by this summer, CNBC reports. Employees of Airbnb in China will be informed of the decision as early as Tuesday morning.</li>
<li>The company plans to maintain a presence in the country, with hundreds of employees working out of an office in Beijing. Even though Airbnb is ending its listings in mainland China, sources say providing homes and experiences for those traveling abroad will become the company&rsquo;s focus.</li>
</ul>

Reuters
<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/05/27362884/heres-where-samsung-looks-to-invest-356b-over-five-years" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Samsung Looks To Invest $356B Over Five Years in Next-Gen Technologies - Here&rsquo;s Why</a>
<ul>
<li>Samsung Electronics Co, Ltd (OTC: <a class="ticker" href="https://www.benzinga.com/stock/ssnlf#OTC">SSNLF</a>) looks to invest 450 trillion won ($356 billion) in the next five years to accelerate growth in semiconductors, biopharmaceuticals, and other next-generation technologies.</li>
<li>The investments through 2026 will likely help Samsung drive long-term growth in strategic areas like the chip sector while pledging aggressive investments in the biopharmaceutical sector.</li>
<li>Samsung clarified that 80% of investments catered to South Korea, and the investment includes a 240 trillion won investment pledge made in August 2021.</li>
</ul>
<a class="editor-rtfLink" href="https://www.benzinga.com/general/biotech/22/05/27365173/who-says-monkeypox-outbreak-unusual-but-containable-reuters" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">WHO Says Monkeypox Outbreak&rsquo; Unusual&rsquo; But &lsquo;Containable&rsquo;</a>
<ul>
<li>The World Health Organization (WHO) said that there had been 131 confirmed monkeypox cases and 106 further suspected cases, Reuters reported.</li>
<li>While the outbreak is unusual, the WHO said it remains &ldquo;containable&rdquo; and limited. It convenes further meetings to support member states with more advice on how to tackle the situation.</li>
<li>The majority of the recent cases have been reported in Europe.</li>
</ul>
<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/05/27364427/toyota-motor-plans-100-000-production-cut-in-june" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">This Auto Giant Cuts Production Plans Citing Parts Shortage - Read More For Details</a>
<ul>
<li>Toyota Motor Corp (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/tm#NYSE">TM</a>) plans to cut global production by about tens of thousands of units to roughly 850,000 vehicles in June due to the semiconductor shortage.</li>
<li>The auto major expects to produce 9.7 million units for the full period of the fiscal year 2023.</li>
<li>The average global production plan from June through August is around 850,000 units.</li>
</ul>
<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/05/27364672/semperis-a-cybersecurity-business-raised-more-than-200m-in-a-funding-round-led-by-kkr" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">This Cybersecurity Firm Raised Significant Amount In KKR Led Funding Round - Read How Much</a>
<ul>
<li>Semperis, a cybersecurity software startup based in the United States, has announced a $200 million funding round led by private equity firm KKR &amp; Co Inc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/kkr#NYSE">KKR</a>) at a significantly higher valuation than its previous round.</li>
<li>Existing investors such as Insight Partners and new investors such as Ten Eleven Ventures joined KKR in the round, according to Semperis.</li>
<li>KKR invested through its Next Generation Technology Growth Fund II, which raised $2.2 billion from investors in January 2020.</li>
</ul>

Bloomberg
<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/05/27365339/wall-street-bank-lobby-protests-debut-of-feds-backed-digital-dollar" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Big Wall Street Banks Do Not Want Fed-Backed Digital Dollar Crypto Alternative - Read Why</a>
<ul>
<li>Wall Street bankers are urging the U.S. government to postpone the debut of a digital dollar, arguing that a virtual currency backed by the Federal Reserve will drain hundreds of billions of dollars from the banking system.</li>
<li>According to the American Bankers Association and the Bank Policy Institute, an American central bank digital currency, or CBDC, would be a direct rival to private bank deposits, making credit less available to businesses and households.</li>
<li>&ldquo;As we have evaluated the likely impacts of issuing a CBDC it has become clear that the purported benefits of a CBDC are uncertain and unlikely to be realized, while the costs are real and acute,&rdquo; the ABA said in a May 20 letter to the Fed.</li>
</ul>

Financial Times
<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/05/27364437/sec-working-on-pending-rules-on-misleading-esg-investment-claims-ft" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">SEC Working On Pending Rules On Misleading ESG Investment Claims</a>
<ul>
<li>Securities and Exchange Commission is preparing rules to specify disclosures to be made by investment funds with terms such as environmental, social, and governance (ESG), sustainable, or low-carbon in their names.</li>
<li>Financial Times writes that the broader ESG investing category covers environmental and climate considerations, &ldquo;impact&rdquo; investing for the social good, and funds that screen out industries such as tobacco or firearms.</li>
<li>On Monday, SEC announced a $1.5 million legal settlement, first related to funds&rsquo; ESG descriptions, against BNY Mellon&rsquo;s investment adviser division over allegations of misstating and omitting information about ESG criteria for mutual funds it managed.</li>
</ul>
<a class="editor-rtfLink" href="https://www.benzinga.com/government/22/05/27364454/amazon-in-trouble-as-shareholders-seek-to-question-pay-tax-working-conditions" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Amazon Shareholders Seek To Question Pay, Tax, Working Conditions in CEO Andy Jassy&rsquo;s First Annual Meet</a>
<ul>
<li>Amazon.com Inc (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/amzn#NASDAQ">AMZN</a>) shareholders look to challenge its executive pay, tax transparency, working conditions, and unionization as CEO Andy Jassy faces his first annual meeting. </li>
<li>The Amazon Labor Union leader Chris Smalls will call Amazon to issue a report detailing its &ldquo;freedom of association&rdquo; policies and collective bargaining.</li>
<li>Influential investor advisory groups Institutional Shareholder Services (ISS) and Glass Lewis backed a proposal for a racial equality audit and independent audit on working conditions at Amazon facilities that Norwegian pension fund Norges Bank agreed to support.</li>
</ul>

Benzinga
<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/05/27362728/nio-eyes-vertical-integration-with-proposed-battery-assembly-pilot-plant-and-testing-labs-in-shangha" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Nio To Invest $32M Toward Vertical Integration Of Battery Manufacturing: Report</a>
<ul>
<li>Nio, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/nio#NYSE">NIO</a>) is pursuing vertical integration amid the supply crunch and input price inflation.</li>
<li>The Chinese electric vehicle startup is planning to set up lithium-ion battery labs and a pilot production line for batteries in Shanghai, the CnEVPost reported, citing an environment assessment report filed with the local municipal body.</li>
<li>The company plans to invest about 218.5 million yuan ($32.75 million) in the plant and commence construction between August and October.</li>
</ul>
<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/05/27362832/dogecoin-slides-in-early-trading-what-you-need-to-know" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Dogecoin Daily: Price Slumps Again, Declining Trader Sentiment And More</a>
<ul>
<li>Dogecoin DOGE/USD traded 3.2% lower at $0.08 over 24 hours leading up to early Tuesday morning.</li>
<li>DOGE traded lower in tandem with other major coins as the global cryptocurrency market cap slipped 3.4% to $1.3 trillion at press time.</li>
<li>DOGE was among the most mentioned coins on Twitter at press time. The three most mentioned coins were Bitcoin, Solana and Terra, according to Cointrendz data.</li>
</ul>
<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/05/27365594/whats-new-at-instragam" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Instagram Undergoes Visual Refresh: Here Are The Details</a>
<ul>
<li>True to the adage &ldquo;necessity is the mother of all invention,&rdquo; the necessity to stay alive in the competitive race has led Meta Platforms, Inc.&rsquo;s (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/fb#NASDAQ">FB</a>) Instagram app to do a makeover.</li>
<li>Instagram will have a refreshed visual identity, with new colors, typeface, logo and other brand elements, the photo and video sharing app said in a blog post on Monday.</li>
<li>To feel illuminated and alive, Instagram reimagined its gradient using an innovative 3D modeling process, the Facebook parent Meta-owned app said. The illuminated moving gradient signals moments of discovery in its marketing, logo and even in-app, it added.</li>
</ul>
<a class="editor-rtfLink" href="https://www.benzinga.com/markets/cryptocurrency/22/05/27362405/netflix-love-death-robots-features-nft-scavenger-hunt-with-hidden-codes" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Netflix&rsquo;s &lsquo;Love, Death + Robots&rsquo; Features NFT Scavenger Hunt With Hidden QR Codes</a>
<ul>
<li>The new season of Netflix Inc&rsquo;s (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/nflx#NASDAQ">NFLX</a>) &lsquo;LOVE, DEATH + ROBOTS&rsquo; (LDR) features a scavenger hunt for nine hidden QR codes. </li>
<li>LDR&rsquo;s official Twitter account tweeted, &ldquo;the hunt begins,&rdquo; as season 3 of the David Fincher-produced adult animated series aired on May 20. </li>
<li>The nine QR codes have been scattered across the shows&rsquo; social media and within the episodes themselves. Users that find the hidden codes can scan them to mint non fungible tokens (NFTs) which will be displayed on their OpenSea accounts.</li>
</ul>
<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/05/27362396/nio-rival-xpeng-retains-bullish-rating-from-this-analyst-but-gets-a-7-price-target-cut-heres-why" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Cathie Wood-Backed Tesla Rival Xpeng Gets A 7% Lower Price Target But Why Analyst Is Still Bullish</a>
<ul>
<li>Tesla Inc. (NASDAQ: <a class="editor-rtfLink" href="https://www.benzinga.com/stock/tsla#NASDAQ" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">TSLA</a>) rival Xpeng Inc (NYSE: <a class="editor-rtfLink" href="https://www.benzinga.com/stock/xpev#NYSE" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">XPEV</a>) is expected to overcome near-term COVID-19 lockdown challenges in China on resilient demand, US Tiger Securities Inc said, after the Guangzhou-based electric vehicle maker posted a disappointing delivery forecast for the current quarter.</li>
<li>The Xpeng Analyst: Analyst Bo Pei has maintained a &lsquo;buy&rsquo; rating on the stock but lowered his price target to $40 from $43 &mdash; the second such cut since March.</li>
<li>The Xpeng Thesis: The New York-based analyst said he expects the operating environment to improve meaningfully in the third quarter for the EV maker as China is on track to fully reopen in June.</li>
</ul>
<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/05/27362508/snap-ceo-hints-at-hiring-slowdown-and-spending-cuts-after-warning-of-q2-shortfall" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Snap CEO Hints At Hiring Slowdown, Spending Cuts After Warning Of Q2 Shortfall</a>
<ul>
<li>Snap, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/snap#NYSE">SNAP</a>) shares tumbled to a two-year low in after-hours trading on Monday after the Snapchat parent company warned that it might miss its second-quarter guidance.</li>
<li>Following an 8-K filing to this effect, the company&rsquo;s CEO Evan Spiegel reportedly sent an internal memo to employees, seeking to clarify the company&rsquo;s position.</li>
<li>Revenue Slowing: Revenue at Snapchat continues to grow, although, at a slower pace than anticipated, Spiegel said, according to a copy of the memo shared by Bloomberg.</li>
</ul>
<a class="editor-rtfLink" href="https://www.benzinga.com/markets/cryptocurrency/22/05/27362296/lockheed-martin-and-filecoin-explore-hosting-a-blockchain-in-space-report" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Lockheed Martin And Crypto Firm Explore Hosting A Blockchain In Space</a>
<ul>
<li>Defense contractor Lockheed Martin Corporation (NYSE: <a class="editor-rtfLink" href="https://www.benzinga.com/stock/lmt#NYSE" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">LMT</a>) and Filecoin FIL/USD are looking into hosting a blockchain network in outer space.</li>
<li>A Monday report from CoinDesk detailed the partnership between Lockheed Martin and the Filecoin Foundation that was announced at World Economic Forum&rsquo;s annual meeting.</li>
<li>The two organizat=ions have plans to identify a satellite or other space-faring platform capable of supporting an InterPlanetary File System (IPFS) node. The next steps will be to assess the platform&rsquo;s needs and select a test mission.</li>
</ul>
<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/05/27342072/apple-files-with-the-fcc-for-mystery-accessory-heres-what-we-know-about-it" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Apple Seeks FCC Approval For &lsquo;Mystery&rsquo; Accessory: Here&rsquo;s What We Know About It</a>
<ul>
<li>Apple, Inc. (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/aapl#NASDAQ">AAPL</a>) is trying to get regulatory approval for a new network adapter that runs its iOS, documents filed with the Federal Communication Commission (FCC) show.</li>
<li>The product, registered under the name A2657, is mentioned as a network adapter belonging to the class of low-power communication device transmitters.</li>
<li>The development was reported earlier by 9to5Mac.</li>
</ul>
<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/05/27363570/starlink-rolls-out-new-service-for-rvs-heres-how-it-differs-from-at-home-connection" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Elon Musk&rsquo;s Starlink Internet Service Now Available For RVs: Is It For You?</a>
<ul>
<li>Elon Musk-owned SpaceX&rsquo;s Starlink satellite internet service is now available for recreational vehicles and campers.</li>
<li>Starlink announced the &ldquo;Starlink for RVs&rdquo; service and pitched it as an ideal option for those customers traveling to locations without steady connectivity.</li>
<li>It, however, cautioned that the service is not designed for use while in motion. Sharing the news on Twitter, Musk suggested &ldquo;Starlink for RVs&rdquo; may not be available for cars, given the antennas may be too big to be accommodated.</li>
</ul>
Photo via Wikimedia Commons

$ETH

AAPL

ABNB

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NFLX

First Trust NASDAQ ABAmmunity Bank Index Fund

QABA

SIGA

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SSNLF

TSLA

VWAGY

XPEV

Morning Brief: Top Financial Stories Dominating on Tuesday, May 24

Wall Street bankers are urging the U.S. government to postpone the debut of a digital dollar, arguing that a virtual currency backed by the Federal Reserve will drain hundreds of billions of dollars from the banking system,&nbsp;<a class="editor-rtfLink" href="https://www.bloomberg.com/crypto?sref=TBDibEcD" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">reported Bloomberg</a>.
What happened:&nbsp;According to the American Bankers Association and the Bank Policy Institute, an American central bank digital currency, or CBDC, would be a direct rival to private bank deposits, making credit less available to businesses and households.&nbsp;
&quot;As we have evaluated the likely impacts of issuing a CBDC it has become clear that the purported benefits of a CBDC are uncertain and unlikely to be realized, while the costs are real and acute,&quot; the ABA said in a May 20 letter to the Fed.
&quot;Based on this analysis, we do not see a compelling case for a CBDC in the United States today,&quot; the ABA added.
In March, the White House said in an executive order on&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/money/best-cryptocurrency/" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">cryptocurrency</a>&nbsp;policy that it placed the &quot;highest urgency&quot; on research and the possible development of a U.S. digital dollar.
While supporters say that a Fed-backed digital currency would help ensure the dollar&#39;s dominance while countries like China develop their versions, Wall Street trade groups say that such a step could backfire.
Even if banks and other financial institutions function as intermediaries, any funds placed in a CBDC account by their customers cannot be used to support loans or other economic investments, according to the groups.&nbsp;
Furthermore, the parties believe that capping the size of CBDC accounts to limit fallout will be ineffective. The ABA anticipated that a $2,500 deposit cap would still drain $446 billion from traditional banks, and a $10,000 cap would result in more than $1 trillion in deposits leaving the system.
Photo by Sharon McCutcheon on Unsplash

Big Wall Street Banks Do Not Want Fed-Backed Digital Dollar Crypto Alternative - Read Why

Regional banks ETFs are rising this week. There are many reasons behind this trend.
The economy is gaining momentum and most of the recent economic reports, including the jobs report, have been better than expected. Regional banks benefit from an improving economy as loan growth picks up.
And rates are rising. The 10-year note yield, which was around 2.4% at the beginning of the year had surged to over 3.1% last month. It has since come down to around 2.95%, mainly due to geopolitical concerns.
Rates have been inching higher again after the jobs report and the Fed appears all set to raise rates at its meeting next week.
Last month, the congress approved the biggest roll-back of Dodd-Frank reforms that were enacted in the aftermath of the financial crisis. Small and regional banks are set to benefit from easing of these regulations.
A strong economy and higher interest rates benefit all banks but regional banks stand to benefit more since interest rate spread is their main source of earnings.
<iframe allow="autoplay; encrypted-media" allowfullscreen="" frameborder="0" height="315" src="https://www.youtube.com/embed/RymUpi-hJR8" width="560"></iframe>
The SPDR S&amp;P Regional Banking ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/kre#NYSE">KRE</a>) is the most popular ETF in the space with $5.2 B in AUM. It&#39;s an equal-weighted ETF with 120 holdings.
The iShares U.S. Regional Banks ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/iat#NYSE">IAT</a>) has 53 holdings and top three holdings&mdash;U.S. Bancorp (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/usb#NYSE">USB</a>), PNC Financial (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/pnc#NYSE">PNC</a>) and BB&amp;T (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/bbt#NYSE">BBT</a>)&mdash;account for more than one-third of assets.
The PowerShares KBW Regional Banking Portfolio (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/kbwr#NASDAQ">KBWR</a>) also follows equal-weighing methodology. It has 50 holdings and higher exposure to small and micro-cap banks than the other two.
Related Links:
<a href="https://www.benzinga.com/government/18/05/11799676/whats-the-volcker-rule-and-why-are-banks-celebrating-the-feds-proposed-cha">What&#39;s The Volcker Rule, And Why Are Banks Celebrating The Fed&#39;s Proposed Changes?</a>
<a href="https://www.benzinga.com/fintech/18/05/11720497/jpmorgan-hsbc-citigroup-early-warning-execs-talk-fintech-collaboration">JPMorgan, HSBC, Citigroup, Early Warning Execs Talk Fintech Collaboration</a>

Regional Bank ETFs: What Investors Need To Know

-tweet from CNBC Pro
<a href="https://twitter.com/CNBCPro/status/997129514118471680">https://twitter.com/CNBCPro/status/997129514118471680</a>

Rumors

Media

'Steve Eisman: We could be on 'the cusp of an M&A wave' in regional banks'

Financial services, the second-largest sector weight in the S&amp;P 500 behind technology, has been soaring and expectations of more interest rate hikes from the Federal Reserve are a big reason why. That dream could be realized this week as many bond market participants are expecting the Fed will raise rates, setting the stage for rate hikes as 2017 moves along.
The Financial Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xlf#NYSE">XLF</a>), the largest financial services exchange traded fund by assets, is up more than 39 percent over the past year, leaving some to ponder whether the sector is still a credible value destination.
Valuation concerns for financial stocks could be more applicable to more focused sub-sectors, such as rate-sensitive regional banks. For example, the iShares U.S. Regional Banks ETF (NYSE: <a class="ticker" href="/stock/iat#NYSE">IAT</a>) is up 4.1 percent year-to-date, bringing its one-year gain to 48.5 percent.
&ldquo;While some of the gains have come down to improvements in fundamentals, as with the broader market, much of the gains have been driven by more expensive valuations,&rdquo; said BlackRock<a href="https://www.blackrockblog.com/2017/03/08/us-banks-cheap/"> in a recent note</a>. &ldquo;The <a href="http://www.investopedia.com/terms/p/price-to-bookratio.asp" target="_blank">price-to-book ratio (P/B)</a> on the sector is up over 40% from last summer&rsquo;s lows. That said, valuations are still about 25% below the average since the early 1990s, although the P/B is now creeping back towards the post-crisis high.&rdquo;
As its name implies, IAT holds what are described as regional banks, which significantly levers the ETF to Fed policy because regional banks are among the assets most positively correlated <a href="https://www.benzinga.com/trading-ideas/long-ideas/16/12/8824316/taking-what-they-want-and-leaving-modest-departures-from-bank">to rising Treasury yields</a>.
The $790.4 million IAT holds 54 stocks, the largest members of which can be considered super regional banks, not pure regional banks. For example, US Bancorp (NYSE: <a class="ticker" href="/stock/usb#NYSE">USB</a>), PNC Financial Services Group Inc. (NYSE: <a class="ticker" href="/stock/pnc#NYSE">PNC</a>) and BB&amp;T Corp. (NYSE: <a class="ticker" href="/stock/bbt#NYSE">BBT</a>), a combined 34 percent of IAT&#39;s lineup, all fit the bill as super regional banks.
&ldquo;Valuations look less pricey relative to the broader market, which may say more about extended U.S. stocks than cheap banks. Large cap banks are trading at a 60% discount to the broader market,&rdquo; according to BlackRock. &ldquo;This looks very reasonable against a 25-year horizon, during which the average discount was only around 40% (see the accompanying chart). However, as with absolute valuations, relative value is less enticing when compared to the post-crisis norm. Relative valuation for large U.S. banks is now back to the highest level since early 2014.&rdquo;
Disclosure: The author owns shares of XLF.

Long Ideas

Federal Reserve

Ahead Of The Fed, Let's Assess The Value In Bank ETFs

Down an average of 8 percent year-to-date, the SPDR KBW Regional Banking (ETF) (NYSE: <a class="ticker" href="/stock/kre#NYSE">KRE</a>) and the iShares Dow Jones US Reg Banks Ind.(ETF) (NYSE: <a class="ticker" href="/stock/iat#NYSE">IAT</a>) are prime examples of financial services exchange traded funds that have been confounded by declining Treasury yields.
Losses for more diversified ETFs tracking the sector are significantly less severe. For example, the Financial Select Sector SPDR Fund (NYSE: <a class="ticker" href="/stock/xlf#NYSE">XLF</a>) is down 6.5 percent year-to-date. It is not just declining Treasury yields that are hampering interest rate-sensitive regional bank stocks and ETFs. Oil prices are playing a part in these declines, too.
<bzrlatedlink>Related Link: <a href="http://www.benzinga.com/trading-ideas/long-ideas/16/03/7462425/brazil-etfs-rise-stokes-volume-spike-in-leveraged-counterpart">Brazil ETF's Rise Stokes Volume Spike In Leveraged Counterpart</a></bzrlatedlink>
Short sellers have gone after regional banks with exposure to the energy sector, including some KRE holdings that are based in oil and gas-rich Oklahoma and Texas. However, the current trying environment for regional bank stocks could stoke a fresh round of industry consolidation.
&ldquo;We expect bank M&amp;A to be primarily motivated by cost savings but depressed stock prices may prevent some deals going ahead. Although some banks might prioritise share repurchase schemes over M&amp;A given weak prices, we believe there is heightened appetite for consolidation. This is especially the case among large regional banks, mid-tier players and smaller lenders,&rdquo; said Fitch Ratings<a href="https://www.fitchratings.com/site/fitch-home/pressrelease?id=1000547"> in a new note</a>.
<h3>A Closer Look At IAT</h3>
Home to large, super-regional names such as U.S. Bancorp (NYSE: <a class="ticker" href="/stock/usb#NYSE">USB</a>) and BB&amp;T Corporation (NYSE: <a class="ticker" href="/stock/bbt#NYSE">BBT</a>), some of IAT&#39;s 54 holdings could be buyers in a new wave of regional bank consolidation. BB&amp;T and PNC Financial Services Group Inc (NYSE: <a class="ticker" href="/stock/pnc#NYSE">PNC</a>), among other IAT holdings, have acquisitive histories.
PNC, BBT and other large-cap regionals are found among KRE&#39;s 93 holdings, but the ETF&#39;s holdings have a weighted average market value of just $9.2 billion. That could be a sign the ETF&#39;s exposure to mid- and small-cap regional banks could serve it well if industry consolidation comes to pass.
The impetus for mergers and acquisitions activity in the regional bank group could come from the fact that even if the Federal Reserve boosts rates several times this year, the benefit to net interest margins may not be enough to lift regionals&#39; bottom lines.
&ldquo;Statements made during bank earnings&#39; calls in mid-January indicated that most banks were expecting the US Fed to increase interest rates in summer 2016 and again towards the end of the year. Since then, volatile markets have raised uncertainty about further rate moves in 2016. Even so, we do not think interest rate hikes will provide much uplift to overall bank earnings in 2016 as the operating environment remains challenging. M&amp;A could lead to cost savings, which could support earnings,&rdquo; added Fitch.
Disclosure: Todd Shriber owns shares of XLF.

Maybe Some M&A Activity For These ETFs

On Monday, 13 exchange-traded funds hit 52-week lows and four, or nearly a third, were financial services funds. Members of that dubious quartet were ETFs with significant exposure to regional banks, an industry that has seen rapidly eroding share prices in recent weeks.
The SPDR KBW Regional Banking (ETF) (NYSE: <a class="ticker" href="/stock/kre#NYSE">KRE</a>), the largest regional bank ETF, has tumbled 17.2 percent over the past month, closing Tuesday less than 3 percent above its recently touched 52-week low.
 The First Trust NASDAQ ABA Community Bnk Indx Fnd (NASDAQ: <a class="ticker" href="/stock/qaba#NASDAQ">QABA</a>) has bled 13 percent over the past month and resides just four percent above its 52-week low. Other regional bank ETFs are sporting similarly dour statistics and less-than-encouraging technical outlooks.
<bzrelatedlink>Related Link: <a href="http://www.benzinga.com/news/16/01/6172895/whats-really-weighing-on-financial-services-etfs">What's Really Weighing On Financial Services ETFs</a></bzrelatedlink>
<h3>More Than Treasury Yields' Decline</h3>
It is not just declining Treasury yields that are hampering interest rate-sensitive regional bank stocks and ETFs. Oil prices are playing a part in these declines, too.
&ldquo;While major US banks recently <a href="http://www.ft.com/cms/s/0/bc7dca78-bb9e-11e5-a7cc-280dfe875e28.html#axzz3xs4ys6K0">disclosed</a> the damage caused to date by their respective exposure to US Energy as they provisioned for bad loans, questions still <a href="http://www.zerohedge.com/news/2016-01-16/exclusive-dallas-fed-quietly-suspends-energy-mark-market-tells-banks-not-force-shale?_sm_au_=icVWDq4nRRWJbHS0">circle</a> over the mark-to-market standards in the wake of oil&rsquo;s decade low slump. This has seen short sellers circle banking institutions with regional banks leading the negative sentiment,&rdquo; said <a href="http://www.markit.com/Commentary/Get/25012016-Equities-Shale-oil-spilling-over-into-regional-banks">Markit</a> in a new research note.
The research firm pointed out that short interest in Texas-based Cullen/Frost Bankers, Inc. (NYSE: <a class="ticker" href="/stock/cfr#NYSE">CFR</a>) has recently surged and BOK Financial Corp. (NASDAQ: <a class="ticker" href="/stock/bokf#NASDAQ">BOKF</a>), parent company of Bank of Oklahoma, &ldquo;underestimates credit losses ahead of earnings.&rdquo; Those stocks are familiar faces in a slew of regional bank ETFs.
&ldquo;Since the beginning of 2015, average short interest across North American banks has increased by 30 percent, reaching 2 percent of shares outstanding on loan. Regional banks have led the surge forward with the firms that make up the iShares US Regional Banks ETF now seeing 3.5 percent of their shares out on loan, up from 2.5 percent in early 2015,&rdquo; added Markit.
<h3>IAT And USO</h3>
Markit noted that the iShares Dow Jones US Reg Banks Ind.(ETF) (NYSE: <a class="ticker" href="/stock/iat#NYSE">IAT</a>) has recently been tracking the United States Oil Fund LP (ETF) (NYSE: <a class="ticker" href="/stock/uso#NYSE">USO</a>). Over the past 90 days, IAT is off 13.1 percent, while USO is lower by 35.1 percent. What is concerning there is that IAT is heavily allocated to super regionals such as U.S. Bancorp (NYSE: <a class="ticker" href="/stock/usb#NYSE">USB</a>) and PNC Financial Services Group Inc (NYSE: <a class="ticker" href="/stock/pnc#NYSE">PNC</a>).
IAT&#39;s 54 holdings are primarily large-cap stocks whereas other regional bank ETFs tilt more toward mid- and small-cap banks.

Short Ideas

Intraday Update

BOKF

Fed Isn't The Only Problem For Regional Bank ETFs

With 10-year Treasury yields higher by 9.1 percent over the past month, it is not surprising that regional bank stocks and exchange-traded funds, such as the SPDR KBW Regional Banking (ETF) (NYSE: <a class="ticker" href="/stock/kre#NYSE">KRE</a>), are receiving renewed attention.
Regional bank equities and ETFs are known for being positively correlated to rising Treasury yields and<a href="http://www.benzinga.com/trading-ideas/long-ideas/15/11/5996193/investors-are-pouring-into-bank-etfs-ahead-of-fed-meeting"> KRE has reflected as much</a> with a one-month gain of nearly 6 percent. Additionally, KRE, the largest regional bank ETF by assets, is nearly twice as correlated to rising Treasury yields as is the more diverse Select Sector Financial Slct Str SPDR fd (NYSE: <a class="ticker" href="/stock/xlf#NYSE">XLF</a>).
<bzrelatedlink>Related Link: <a href="http://www.benzinga.com/analyst-ratings/analyst-color/15/11/5998864/super-regional-banks-piper-jaffray-is-getting-into-them">"Super-Regional" Banks? Piper Jaffray Is Getting Into Them</a></bzrelatedlink>
<h3>Winter's Fed Meeting Is Coming</h3>
As the December Federal Reserve meeting draws closer, investors should also consider super-regional banks, the larger versions of the banks held by KRE. Super-regionals can be accessed via the $613.1 million iShares Dow Jones US Reg Banks Ind.(ETF) (NYSE: <a class="ticker" href="/stock/iat#NYSE">IAT</a>), an ETF that has climbed by more than 4 percent over the past month.
<h3>Piper Jaffray: Freshly Initiated Regional Banks</h3>
In a note out Tuesday, Piper Jaffray analyst Kevin Barker initiated coverage on a slew of regional banks with a positive bias, noting that these banks are &quot;inexpensive&quot; compared to long-term risk premiums and book value multiples. At the same time, many of the banks boast capital levels that are at multi-decade highs, credit losses are running &quot;well below&quot; long-term averages and the possibility of higher rates also provides the opportunity for &quot;significant&quot; upside optionality, reported <a href="http://www.benzinga.com/analyst-ratings/analyst-color/15/11/5998864/super-regional-banks-piper-jaffray-is-getting-into-them">Benzinga&#39;s Jayson Derrick</a>.
Barker&#39;s top super-regional idea is Citizens Financial Group Inc (NYSE: <a class="ticker" href="/stock/cfg#NYSE">CFG</a>), a stock that is IAT&#39;s seventh largest holding at a weight of 3.3 percent. As Benzinga reported earlier, the analyst likes Citizens so much that he believes the bank can grow earnings 20 percent year-over-year for the next several years.
Barker is also bullish on SunTrust Banks, Inc. (NYSE: <a class="ticker" href="/stock/sti#NYSE">STI</a>), which he rates at Outperform with a $50 price target. That implies decent upside for SunTrust, which currently trades just over $43. The Atlanta-based bank is IAT&#39;s fourth largest holding at a weight of 5.3 percent.
The analyst also initiated coverage of U.S. Bancorp (NYSE: <a class="ticker" href="/stock/usb#NYSE">USB</a>), KeyCorp (NYSE: <a class="ticker" href="/stock/key#NYSE">KEY</a>) and PNC Financial Services Group Inc (NYSE: <a class="ticker" href="/stock/pnc#NYSE">PNC</a>) with Outperform ratings.
U.S. Bancorp and PNC are IAT&#39;s two largest holdings, combining for nearly 29 percent of the ETF&#39;s weight. KeyCorp is also a top 10 holding in the ETF at a weight of 2.6 percent. 
Disclosure: Todd Shriber owns shares of XLF.
Image Credit: <a href="https://pixabay.com/en/superman-hero-comic-1043679/">Public Domain</a>

Initiation

A Super ETF For Super-Regional Banks

The results of financial stress tests of the nation&rsquo;s largest banks were recently released and surprised expectations by besting capital requirements. The majority of the financial and banking institutions were then allowed to <a href="http://www.usatoday.com/story/money/2015/03/11/stress-tests-part-2-banks-federal-reserve-bac/70150998/">announce</a> dividend increases and share buyback plans that led to a strong jump higher in this sector.

	The following ETFs were some of the strongest performers after the announcements were made:
<h3>
	SPDR KBW Bank (ETF) (NYSE: <a class="ticker" href="/stock/kbe#NYSE">KBE</a>)</h3>

	Banking stocks responded with strength on Thursday and KBE was one of the sturdiest of the group. This exchange-traded fund tracks 64 companies engaged in traditional banking and lending services through an equal-weighted structure.

	KBE has approached its highest levels of the last 12-months after months of rocky price action that has seen this index swing back and forth. The news of companies such as Citigroup Inc (NYSE: <a class="ticker" href="/stock/c#NYSE">C</a>) and Wells Fargo &amp; Co (NYSE: <a class="ticker" href="/stock/wfc#NYSE">WFC</a>) increasing their returns to shareholders may be just what this ETF needs to break out of its sideways trend.
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	<bzrelatedlink>Related Link: <a href="http://www.benzinga.com/etfs/sector-etfs/15/03/5313697/bullish-catalysts-for-regional-bank-etfs">Bullish Catalysts For Regional Bank ETFs</a></bzrelatedlink>
<h3>
	iShares Dow Jones US Reg Banks Ind.(ETF) (NYSE: <a class="ticker" href="/stock/iat#NYSE">IAT</a>)</h3>

	Small- and mid-sized banks also joined in on the sector strength on Thursday, as IAT rose back near its 2015 highs. This ETF tracks 53 regional financial institutions, which include companies such as U.S. Bancorp (NYSE: <a class="ticker" href="/stock/usb#NYSE">USB</a>) and PNC Financial Services Group (NYSE: <a class="ticker" href="/stock/pnc#NYSE">PNC</a>).

	IAT can be used to target a specific niche of the banking sector that eschews exposure to larger financial institutions. This fund has over $560 million in total assets and charges an expense ratio of 0.43 percent.
<h3>
	Direxion Daily Financial Bull 3X Shares (NYSE: <a class="ticker" href="/stock/fas#NYSE">FAS</a>)</h3>

	Aggressive investors love to use leverage, and FAS is one of the most popular leveraged ETFs in this sector. This fund has over $1.3 billion in total assets and is the fifth-largest ETF by assets in the financial arena.

	FAS is designed to track three times the daily price movement of the Russell 1000 Financial Services Index. This includes over 230 banking, capital markets, REIT and insurance companies.

	FAS is an option to magnify returns in financial stocks over a short period of time, but investors should be wary about the high risk and suitability of leverage before considering this vehicle.

3 Financial ETFs Exploding Higher On Stress Test News

While the market fell almost 2 percent on Friday, the regional bank sector bucked the trend as it was the only sector to finish in the green.

	The strength can be attributed to two major factors, Fed stress tests and <a href="http://www.benzinga.com/news/15/03/5312417/when-should-the-fed-raise-rates">rising interest rates</a>.

	The Fed revealed that all 31 of the largest banks have enough capital to weather losses in the event of an economic downturn -- the first time every bank has passed the central bank&#39;s annual stress tests.

	The largest U.S.-based banks &quot;continue to build their capital levels and to strengthen their ability to lend to households and businesses during a period marked by severe recession and financial market volatility,&quot; the Fed said on Friday.

	An interest rate hike by the Fed would lead to the regional banks being able to charge more to lend money, thus increasing their bottom line margins.
<h3>
	Affected Regional Bank ETFs</h3>

	1. The iShares U.S. Regional Banks ETF (NYSE: <a class="ticker" href="/stock/iat#NYSE">IAT</a>), which consists of 53 small and mid-sized domestic regional U.S. banks. 

	Top holdings include U.S. Bancorp (NYSE: <a class="ticker" href="/stock/usb#NYSE">USB</a>) with a large weighting of 19.8 percent, PNC Financial Services Group Inc. (NYSE: <a class="ticker" href="/stock/pnc#NYSE">PNC</a>) with 12.2 percent and BB&amp;T Corp (NYSE: <a class="ticker" href="/stock/bbt#NYSE">BBT</a>) with 6.9 percent.

	<bzrelatedlink>Related Link: <a href="http://www.benzinga.com/etfs/specialty-etfs/15/03/5307045/the-u-s-natural-gas-environment-in-8-charts#ixzz3U15eaVov">The U.S. Natural Gas Environment In 8 Charts</a></bzrelatedlink>

	IAT is up 2 percent over the last 12 months and up 5 percent over the last six months.

	The ETF came close to breaking out to its highest level since 2008, but failed to follow through. A close above $35.81 would be a major breakout and Buy signal. The ETF has an expense ratio of 0.43 percent.

	2. The SPDR S&amp;P Regional Bank ETF (NYSE: <a class="ticker" href="/stock/kre#NYSE">KRE</a>), which is made up of 86 regional banks with diverse weightings. 

	The top three holdings all have a weighting of 1.6 percent, and they include BankUnited Inc (NYSE: <a class="ticker" href="/stock/bku#NYSE">BKU</a>), City National Corp (NYSE: <a class="ticker" href="/stock/cyn#NYSE">CYN</a>) and First Republic Corp (NYSE: <a class="ticker" href="/stock/frc#NYSE">FRC</a>).

	KRE is down 2 percent over the last 12 months and up 4 percent over the last six months. The breakout level on KRE is $42.79, and the ETF has an expense ratio of 0.35 percent.

	3. The PowerShares KWB Regional Banking Portfolio ETF (NYSE: <a class="ticker" href="/stock/kbwr#NYSE">KBWR</a>), which provides investors exposure to 50 U.S.-based regional banks. 

	The top holdings include SVB Financial Corp (NYSE: <a class="ticker" href="/stock/sivb#NYSE">SIVB</a>) with a 4 percent holding, Umpqua Holdings Corp (NYSE: <a class="ticker" href="/stock/umpq#NYSE">UMPQ</a>) making up 3.6 percent and First Niagara Financial Group Inc. (NYSE: <a class="ticker" href="/stock/fnfg#NYSE">FNFG</a>) with 3.2 percent.

	KBWR is down 1 percent over the last 12 months and up 5 percent over the last six months.

	The breakout level for KBWR is $41.52, and the ETF has an expense ratio of 0.35 percent.