M* dave,

Any chance that Pat Dorsey or Jaime Peters will give some commentary on Basel I and II, specifically tier I and II capital. What I am getting at is many banks still look to need to make some additional provisions to cover loan losses. To use WB as an example, just announced having to buy back about 8.5 billion in Auction rate securities and to my understanding only abot 500m has already been reserved for such an issue. I would assume this could serious impact funds in excess of Tier 1 capital requirements when you consider the loan losses that still lie ahead.

So the point, I think it would be nice either via this thread or a morningstar video if we saw something education regarding how to determine a banks financial strength, its uses and abilities to generate additional capital and on a deeper note a good bench mark on how to measure a companies tier I and tier II capital. The balance sheet on a bank can be very elusive because of a lack of ability to measure the risk of the banks portfolio. Everyone seems to think WB will need to raise more capital soon, but then now one (including morningstar's analysis to this point) appears to have any real concern about what this does to the bank's balance sheet now.

While I am at it, in reviewing various different banks I have noticed the trend to include a break out of various loan types by credit quality and ltv %. Some thankfully seem to be making the effort to re-examine the true current ltv. But even with that I have yet to examine a bank that reports those loan balances that exceed 100% LTV. Any useful insight that you might have into the idea how to model future charge off/provisions? Realtytrac still shows some pretty nasty numbers out there in the largest areas that many big banks targeted; florida, california, arizona, nevada. So scary in fact that it is hard to believe the idea of a bottom in prices with the high level of supply, the bulk in some areas actually being homes that are short sales and already foreclosed on properties.

BGF