Dick Bove: Banks Have Massive Exposure to Energy (but he doesn’t care)

Aside from giving you my point of view, I feel it’s important to provide readers of the site with all sorts of views from a wide array of people. Information is power and iBankCoin is a powerhouse in financial content. That being said, I am about to pull out a relic from the banking crisis era: Dick Bove.

This is a guy who was widely derided by me back in 2008-2009 for apologizing for the banks, recommending purchase of them, JUST PRIOR TO THEIR COLLAPSE. He literally had no idea, whatsoever, of what he was doing back then, despite having all of the facts and information in front of his face. In other words, he’s a fucking moron.

Watch this video and you will hear him say the banks probably have DOUBLE the amount of energy exposure that is being reported. Off the back of this envelope I have in front of me now, the numbers get deep into the $100’s of billions in basic resource loan exposure. He then says investment banking will thrive, for reasons that escape me and that asset management will suck eggs. Despite all that, he likes banks and I don’t think he even knows why.

He did, however, draw a line when it came to Citigroup, pointing to the sheer fuckery on their balance sheet, from mining to China to energy. There are all sorts of splendid ways the sages at Citi have positioned the bank, since 2008, to lose. Funny thing, as evidenced by the CNBC caption under Bove’s face, they put “Bove: Citi is Severely Undervalued.” However, nowhere during this interview did he say that. As a matter of fact, he was somewhat sanguine over their prospects. More CNBC tomfoolery, I suppose.