Natrional City to be absorbed by PNC Financial

I'm not sure yet what all the ramifications of this will be.

PNC Financial Services Group Inc. will absorb National City Corp. after federal officials turned down National City's request for new capital under the government's $700 billion rescue program.

PNC agreed to pay $5.6 billion for National City, an Ohio-based bank holding company that ran into trouble because of expansion and exposure to subprime mortgage loans. The price of $2.23 a share reflects a roughly 19 percent discount to National City's closing price the day before the deal was announced.

The Treasury Department and the Federal Deposit Insurance Corp. helped arrange the takeover. The deal marked the first time that the government has intervened in picking winners and losers in the financial industry since Treasury officials announced that part of the $700 billion in bailout money would be used to make direct investments in banks rather than to buy their troubled assets.

Read the whole thing at Bailout Sleuth: Picking Winners

NCC stock price

National City's stock price continued it's upward trend after Monday's disaster.

It closed today at $3.14 on volume of $196 Million. (Link.)

Standing by for whatever Friday will bring.

NCC coming back, and a possible FDIC take-over

National City stock price increased by more than a dollar to close today at $2.89 on volume of $588 Million. That's the good news.

The not so good news, according to the well known website, ClusterStock:

We don't mean to be alarmist, but it seems almost inconceivable that depositors at National City (NCC) and Sovereign (SOV) aren't running for the hills. WaMu's depositors yanked $16.7 billion from WaMu in the 10 days after Lehman failed, and the stocks of NCC and SOV are doing an excellent WaMu imitation (see below).

The relevant FDIC staffers are probably still recovering from the all-nighter they just pulled on Citi-Wachovia, but we recommend they get their butts out to NCC and SOV before they have no choice but to put the shops into receivership.

That was as of Monday the 29th. See the entire post for charts and graphs.

Well, the stampede on National City came on the same day as the bailout failure and the 777 stock market dive.

NCC trying to recover

Well, after a disastrous day yesterday, National City's stock price came back by 39 cents today, to close at $1.75 (link).

Yesterday's NCC volume was over $312 Million compared to today's $213 Million.

Yesterday, the Dow closed down 777 points. It got back 485 of those points today, closing at

This partial recovery is thanks to the news that Congress will reconsider the bank rescue plan, a/k/a bailout, that went down in flames yesterday (CNN: Dow comes back big).

Bailout failure and stock market

On news of Congress's failure to pass the bailout legislation today, the Dow closed down 614 points.

It seems banks are falling left and right.

National City isn't doing too well, either.

It looks like NCC closed today at $1.36, which is down about 64% from this morning.

Washington is broke. We are in trouble.

Correction: On Monday, the Dow closed down 777 points.

National City in Springfield robbed

From the State Journal-Register:

National City Bank, 802 S. 11th St. [Springfield, Illinois], was robbed Monday morning.

A man walked in about 9:10 a.m. with his face concealed by a turquoise handkerchief. He approached a teller, demanded money at gunpoint, then fled.

A witness followed the robber as he ran and saw him go behind a house at 14th and Clay streets, where he changed clothes. The witness did not have a cell phone, so he left the scene briefly to alert police where the robber was. When officers got there, he was gone.

The robber was described as black and 25-30 years old. He was wearing a dark blue sweatshirt, maroon or dark purple pants and gray shoes with white laces. He also was wearing a black White Sox cap with the word “Sox” in white letters vertically on the front.

He possibly was carrying a paper bag with an emblem on it. (Link.)

Geez. That's the branch where I opened my account, and quite possibly the littlest bank I've ever been in. Here's hoping they catch the guy. Speaking of which, if anyone has a tip on this crime or any other in Central Illinois, call Crime Stoppers at 217-788-8427.

Tues., Aug. 5, 2008, NCC updates

National City stock closed up today at $5.05 on volume of 19 million. (Source.)

BloggingStocks.com takes note of National City in a piece with some good historical points:

What went wrong? At number 6 on our list of SPX underdogs, NCC gave up 87% of its value from June 30, 1998 through June 30, 2008. The stock peaked at $40 in November 2005, and then edged sideways ... until it ran headlong into the subprime tsunami. (Worst 10-year performers: National City mauled by mortgage meltdown.)

And, following up on the previously reported effort to sell off Allegiant:

The first round of bids for National City Corp's (NCC.N: Quote, Profile, Research, Stock Buzz) Allegiant Funds asset management business were due at the end of last week, a person familiar with the matter said on Tuesday.

National City, being represented by Morgan Stanley, was expected to go through the offers and decide which bidders to invite to conduct due diligence for the operation, the source said.

[...]

A National City spokeswoman declined to comment. (Reuters.)

Tues., July 29, 2008, NCC close

National City closed the day at $4.98.  Compared to the last couple months, that seems almost healthy.

In other news, Nisa Investment Advisors 133,998 shares of NCC, leaving it with 14,000 shares in its portfolio, per filings made public on 2008-07-28 (link).

Fri., July 25, 2008, NCC stock notes

Is confidence in National City getting back to normal? Maybe, if a $5.10 close price is any measure of normalcy. (Source.)

Today's National City Conference Call

Instead of trying to rehash the thing, perhaps it's best to just link to National City's press release and note a few highlights. Off the top:

• Net Loss of $1.8 Billion Driven By Actions to Increase Loss Reserves on Liquidating Loan Portfolios; Includes $1.1 Billion After-Tax Non-Cash Goodwill Charge Related to Previous Acquisitions -- No Effect on Regulatory Capital
• Excluding Unusual and Non-Operating Items, Pre-Tax Pre-Provision Operating Earnings Were $610 Million, Up 19%
• Tier 1 Capital $7 Billion over Well Capitalized Minimum; 11.1 % Tier 1 Capital Ratio Highest of All Major U.S. Banks
• Net Charge-Offs of $740 Million, Predominantly in Liquidating Loan Portfolios Versus $1.6 Billion Provision for Loan Losses; Nonprime Delinquencies Down
• Solid Progress in Actively Managing Liquidating Loan Portfolios, Which are Isolated, Contained, and Performing in Line with Expectations
• Aggressively Re-Focusing on Core Businesses, Which Remain Profitable; Deposits Continue Solid Growth Trend
• Enhanced Leadership Team Intensely Focused on Managing Risk, Controlling Expenses and Improving Profitability

A lot more can be found in the press release, which is definitely worth reading.

Despite the country's mortgage meltdown and how National City got involved in it and how it is probably going to suffer for it for a long time, I don't think it's too soon to predict that National City and its management will have a lot to be proud of. They've seen the error of their ways and are taking steps to rectify it. Of course, that seven billion helped a lot in calming people's nerves.