It's not a good time to be in the banking business. Banking problems go way beyond the sub prime crisis. The FDIC reports that late payments on home equity loans are now at an all time high. That burden falls heavily on regional and local banks, many of whom had escaped the sub prime meltdown. The import of this is much larger than the pain your friendly local banker is feeling. It's a reflection of the state of the larger economy. We all stand to feel the pain. The WaPo story is here.
Update 6/23: Bloomburg reports Goldman Sachs reversed its May 5 position and now recommends that investors underweight (v. S&P 500) U.S. financial and consumer stocks.