SOURCE: Paragon Financial Limited

Paragon Financial Limited

September 29, 2011 08:16 ET

Bernanke's Operation Twist to Spur Loan Growth at Citigroup and JPMorgan

The Paragon Report Provides Equity Research on Citigroup & JPMorgan

NEW YORK, NY--(Marketwire - Sep 29, 2011) - The Paragon Report examines investing opportunities in the Money Center Banking Industry and provides equity research on Citigroup, Inc. (NYSE: C) and JPMorgan Chase & Co. (NYSE: JPM). Access to the full company reports can be found at:

Banking stocks have been volatile since the Federal Reserve announced it will push long term interest rates lower. On the upside, "Operation Twist" is designed to spur loan growth -- something banks have struggled to regain in the aftermath of the recession. Likewise, banks and other financial institutions have been reluctant to lend money as they continue to strengthen up their balance sheets in the aftermath of the housing bubble collapse in 2008. In its statement, the Fed noted that the economy is growing slowly, unemployment is high and housing remains in a prolonged slump. The central bank said in a statement that operation twist was aimed at reducing the cost of borrowing for businesses and consumers, including the cost of mortgage loans. It hopes that the lower rates will encourage companies to build new factories and hire more workers, and consumers to start spending again on homes and cars and clothes and vacations.

The Paragon Report provides investors with an excellent first step in their due diligence by providing daily trading ideas, and consolidating the public information available on them. For more investment research on the Money Center Banking industry register with us free at and get exclusive access to our numerous stock reports and industry newsletters.

In recent quarters, major banks have begun to post improved credit quality. More thorough and cautious credit checks have led to fewer delinquent loans and greater financial stability. As such, Banks are setting aside less money to cover bad loans, and some are seeing loan losses recede. While credit quality improved, the high unemployment rate has been damaging to banks' long term loan growth.

Operation Twist is not without its controversies. Richard Fisher, president of the Federal Reserve Bank of Dallas, said he opposed the Fed's latest attempt to boost economic growth because he fears it won't work and it could scare consumers and squeeze bank earnings. Fisher said the move, dubbed Operation Twist, could prove counterproductive. It might signal to consumers that the Fed believes the economy is "in worse shape than they thought" and prompt them to hoard money, Fisher said.

The Paragon Report has not been compensated by any of the above-mentioned publicly traded companies. Paragon Report is compensated by other third party organizations for advertising services. We act as an independent research portal and are aware that all investment entails inherent risks. Please view the full disclaimer at