Bank stocks are tumbling in the wake of the failures of SVB Bank SIVB and Signature Bank SBNY), but there are good reasons to make this contrarian investment.
First, federal regulators have made clear they will support banks on the edge of trouble because of depositor flight. The Federal Reserve will lend to banks against the full value of losing positions in Treasurys. “That will help banks meet deposit requests,” says Ian Lapey, the portfolio manager of the Gabelli Global Financial Services Fund GAFSX.
Second,…
