Ten years ago, it may have felt like the world was going to end. The financial system appeared broken and banks were to blame. Valuations in the sector fell dramatically and we saw government bailouts around the globe. A decade on and things have changed.US regulators have imposed higher capital requirements and financial services companies have been forced to raise their game. As a result, the banking sector is in much better shape and now looks very different indeed. For one thing, the US is not facing the same national housing issue it was 10 years ago, financial services have less leverage and more liquidity than they have had in decades. In this sense, the global financial crisis (GFC) provided an opportunity to get things right. We believe the US banking sector now looks more resilient than ever: it has not only survived previous downturns but has stood tall.
John Bailer, US equity income manager. Mellon, a BNY Mellon company