Exchange-traded funds that target financial firms were whipsawed as Federal Reserve Chair Janet Yellen’s remarks on interest rates left investors struggling to gauge how soon future increases will help U.S. bank profits.
The biggest U.S. banks are about to learn whether they can pay out more than $75 billion in excess capital to investors as the Federal Reserve completes stress tests of their ability to survive new economic calamities.
Shares of U.S. financial firms just staged their biggest annual rally since 1997, creating a bonanza for Wall Street employees who received bonuses in deferred stock. The new year doesn’t hold the same promise.
Cerberus Capital Management LP is seeking buyers for auto lender Chrysler Financial, which the private-equity firm acquired as part of its takeover of Chrysler LLC in 2007, said people with knowledge of the matter.