Financial, Real Estate, Stock Markets Trends and Current Affairs

Here are some additional tidbits of info on PNC's primary lending markets to serve as an adjunct to the PNC research I released the other day. Remember, this is all to be taken against the backdrop of the macro bank research that I released as well. If you haven't notice, when I take a short position, I am quite serious about it.

PNC Financial Services Group, citing the credit crunch currently roiling the financial services industry, shut down a program in December 2007 that offered home-equity loans via third-party mortgage brokers. PNC plans to close all brokered loans by Feb 29, 2008.release a couple of days ago. This is a trend among many, if not most banks. Reduce the risk and exposure to the HELOC market, and reduce or eliminate origination through brokers.

Links:

http://www.post-gazette.com/pg/07359/844273-28.stm

http://www.gazette.net/stories/123107/businew134530_32356.shtml

The branch network is located primarily in Pennsylvania, New Jersey, Washington, DC, Maryland, Virginia, Ohio, Kentucky and Delaware.

The following are the micro trends in those areas where PNC has just concentrated (by reducing broker production to zero):

				2006	2007	2008
Pennsylvania (Aggregate)		Personal Bankruptcies		77,587	40000	48020
		House Price Index		144.2	147.4	144.3
		Unemployment Rate		5.2	5.0	5.1
		Housing Permits (total units)		44,019	40,300	38,840
		-% change in bankruptcies			-48.4%	20.1%	Consumer financial lines pressured
		-% change in housing permits			-8.4%	-3.6%	Mortgage originations pressured
		-% change in Housing price index			2.2%	-2.1%	Extant LTVs increased
Philadelphia metro division		Personal Bankruptcies		11,439	6,899	7,244
		House Price Index		219.1	222.6	217
		Unemployment Rate		4.7	4.4	4.5
Pittsburgh		Personal Bankruptcies		12,577	7,731	9,275
		House Price Index		158.4	164.2	159.1
		Unemployment Rate		4.9	4.3	4.9
Scranton/Wilkes-Barre MSA		Personal Bankruptcies		2,114	1,162	1,362
		House Price Index		171.8	182.2	177.3
		Unemployment Rate		5.3	4.9	5.1
New Jersy		Personal Bankruptcies		48,811	30,800	36,600
		House Price Index		521.4	574.6	618
		Unemployment Rate		4.4	4.7	4.9
		Housing Permits (total units)		38,375	35,200	31,300
		-% change in bankruptcies			-36.9%	18.8%	Consumer financial lines pressured
		-% change in housing permits			-8.3%	-11.1%	Mortgage originations pressured
		-% change in Housing price index			10.2%	7.6%	Extant LTVs decreased (this trend is reversing though)
Washington D.C.		Personal Bankruptcies		12,071	8,927	10,758
		House Price Index		278.8	280.2	267.2
		Unemployment Rate		3.1	3.1	3.6
		Housing Permits (total units)		27,958	22,402	17,505
		-% change in bankruptcies			-26.0%	20.5%	Consumer financial lines pressured
		-% change in housing permits			-19.9%	-21.9%	Mortgage originations pressured
		-% change in Housing price index			0.5%	-4.6%	Extant LTVs increased
Maryland - Baltimore		Personal Bankruptcies		11,493	5,990	7,187
		House Price Index		248.9	259.9	259.4
		Unemployment Rate		4.10	4.00	4.60
		Housing Permits (total units)		8,133	5,902	4,595
		-% change in bankruptcies			-47.9%	20.0%	Consumer financial lines pressured
		-% change in housing permits			-27.4%	-22.1%	Mortgage originations pressured
		-% change in Housing price index			4.4%	-0.2%	Extant LTVs increased
Ohio		Personal Bankruptcies		133,522	70,000	84,000
		House Price Index		268	277.1	286
		Unemployment Rate		5.9	5.5	5.7
		Housing Permits (total units)		47,401	43,050	41,310
		-% change in bankruptcies			-47.6%	20.0%	Consumer financial lines pressured
		-% change in housing permits			-9.2%	-4.0%	Mortgage originations pressured
		-% change in Housing price index			3.4%	3.2%	Extant LTVs decreased (I expect trend to reverse though)
Delaware (Aggregate)		Personal Bankruptcies		4150	2500	3100
		House Price Index		451.4	496.8	531.3
		Unemployment Rate		4.2	4.0	4.2
		Housing Permits (total units)		8,195	7,000	6,460
		-% change in bankruptcies			-39.8%	24.0%	Consumer financial lines pressured
		-% change in housing permits			-14.6%	-7.7%	Mortgage originations pressured
		-% change in Housing price index			10.1%	6.9%	Extant LTVs decreased (I expect trend to reverse though)
Wilmington Metro Division		Personal Bankruptcies		2,025.30	1,504.80	1,700.40
		House Price Index		213.2	220.2	212.5
		Unemployment Rate		4.0	3.5	3.6
Kentucky		Personal Bankruptcies		39,860	21,000	26,200
		House Price Index		271.8	282.7	292.9
		Unemployment Rate		6.1	5.8	5.9
		Housing Permits (total units)		8,133	5,902	4,595
		-% change in bankruptcies			-47.3%	24.8%	Consumer financial lines pressured
		-% change in housing permits			-27.4%	-22.1%	Mortgage originations pressured
		-% change in Housing price index			4.0%	3.6%	Extant LTVs decreased
PNC's regional profile		Unemployement		4.7	4.6	4.9
		-% change in bankruptcies			-42.0%	21.2%	Consumer financial lines pressured
		-% change in housing permits			-16.5%	-13.2%	Mortgage originations pressured
		-% change in Housing price index			5.0%	2.1%	Extant LTVs decreased slightly, with a general reversal in trend back to higher LTVs for the medium terms