JPMorgan Chase, Goldman Sachs, Citibank, Wells Fargo and More Than 1,800 Other Institutions Believed to Be at Risk of Failure Based on Fourth Quarter 2008 Data

New Data Topic of Audio Press Briefing
JUPITER, Fla.--(Business Wire)--
Several of the nation`s largest banks, including JPMorgan Chase, Goldman Sachs,
Citibank, Wells Fargo, Sun Trust Bank, HSBC Bank USA, plus more than 1,800
regional and smaller institutions are at risk of failure despite government
bailouts, according to Martin D. Weiss, Ph.D., president of Weiss Research,
Inc., an independent research firm.

The analysis is based on Fourth Quarter 2008 data from TheStreet.Com and the
Comptroller of the Currency (OCC). Several large institutions received
significant ratings downgrades from the prior quarter, including Citibank,
downgraded from C- to D; Wells Fargo, downgraded from C- to D+; and SunTrust
Bank, downgraded from C- to D+.

To discuss the new data and his analysis, Dr. Weiss will conduct an audio press
briefing tomorrow, as follows:

Date and time: Tuesday, April 7, 11 a.m., Eastern Time.
Phone # to call: 1-866-228-9900; Overseas +1-719-359-4032.
Conference name: Weiss
Participant passcode: 721451

In addition, Dr. Weiss will provide updated commentary of his white paper issued
on March 19. Titled "Dangerous Unintended Consequences: How Banking Bailouts,
Buyouts and Nationalizations Can Only Prolong America`s Second Great Depression
and Weaken Any Subsequent Recovery," the white paper names U.S. banks and
thrifts believed to be at risk of failure, using that data to demonstrate that
the U.S. government greatly underestimates the scope of the debt crisis, while
overestimating its ability to effectively save troubled institutions without
severe adverse consequences.

The debt crisis is much greater than the government has reported, according to
the white paper. The FDIC`s "Problem List" of troubled banks includes 252
institutions with assets of $159 billion. The updated review by Weiss Research,
however, shows that 1,816 banks and thrifts are at risk of failure, with total
assets of $4.67 trillion, compared to 1,568 institutions, with $2.32 trillion in
total assets in prior quarter.

Five large U.S. banks have credit exposure related to their derivatives trading
that exceeds their capital, with four in particular - JPMorgan Chase, Goldman
Sachs, HSBC Bank America and Citibank - taking especially large risks.

At year end 2008, Bank of America`s total credit exposure to derivatives was 179
percent of its risk-based capital; Citibank`s was 278 percent; JPMorgan Chase`s,
382 percent; and HSBC America`s, 550 percent, according to the Comptroller of
the Currency (OCC). In addition, in the fourth quarter, Goldman Sachs began
reporting as a commercial bank, revealing an alarming total credit exposure of
1,056 percent, or more than ten times its capital. Although the banking
authorities have not defined how much exposure is considered excessive, Weiss
believes that, as a rule, bank exposure to any single risk category should be
limited to 25 percent of capital. Goldman Sachs has exceeded that limit by a
factor of 42 to 1.

"Equally alarming," writes Dr. Weiss, "is the fourth quarter OCC data
demonstrating that record bank losses are spreading to interest-rate
derivatives. Until now, bank derivatives losses have been limited almost
exclusively to credit defaults swaps (CDS), which represent only 7.8 percent of
the notional value U.S. derivatives held by all U.S. banks. In the fourth
quarter, although the CDS losses continued at a near-record pace, we also
witnessed record losses in the interest-rate sector, which represents 82 percent
of the derivatives market: The nation`s banks lost $3.4 billion in interest-rate
derivatives, or more than seven times their worst previous quarterly loss in
this category."

Dr. Weiss continues, "In the face of such enormous risks and losses it`s
entirely unreasonable to expect the U.S. Government to offset them without
unacceptable damage to its own credit, credibility and borrowing power."

Dr. Weiss points to early signs that the credit of the U.S. Treasury may already
be suffering some damage in the wake of government bailout programs such as the
$700 billion Troubled Asset Relief Program (TARP), the Federal Reserve`s recent
$1.15 trillion commitment to purchase bonds, and the $1 trillion Private-Public
Investment Program (PPIP). For example, the cost of credit default swaps traded
by international investors to insure against a future default by the U.S.
Treasury recently surged to 14 times its 2007 level; while, more recently, the
price of the 30-year Treasury bonds has fallen by 24 points.

"The `too-big-to-fail` doctrine has failed," concludes Weiss. In its place, he
recommends the following steps to build a firmer foundation for a future
recovery:

* Abandon the unrealistic goal of saving all failing financial institutions,
focusing instead on the goal of rebuilding the economy`s foundation in
preparation for an eventual recovery.
* Pro-actively downsize or shut down the weakest institutions no matter how
large they may be; provide opportunities for borderline institutions to
rehabilitate themselves under a strict regulatory regime; and give
well-capitalized, liquid and prudently-managed institutions better opportunities
to gain market share.
* Seriously consider breaking up the weak megabanks, following the model of the
Ma Bell breakup in 1984.
* Build confidence in the banking system with better disclosure and
transparency, including the public release of the confidential official ratings
on all banks called CAMELS (Capital adequacy, Asset quality, Management,
Earnings, Liquidity and Sensitivity to market risk).
* Switch priorities from the battles we can`t win to the war we can`t afford to
lose, such as emergency assistance for the millions most severely victimized by
a depression.

Due to the nation`s solid infrastructure and knowledge base, Weiss is optimistic
the U.S. can survive a broader banking crisis and even a second great
depression, with good prospects for an eventual recovery, provided we make the
right choices. Toward that goal, immediately following the audio press briefing
tomorrow, Dr. Weiss will launch a national grassroots campaign with an online
video webinar for over 50,000 investors that have registered for the event. The
webinar takes place at 12 noon Eastern Time and the press is also invited to
attend by registering at http://images.moneyandmarkets.com/DSG-MED/.

About Martin D. Weiss, Ph.D.

Martin D. Weiss, Ph.D., founder and president of Weiss Research, Inc. and a
leading advocate for investor safety, is a nationally recognized expert on
banking and insurance company solvency. With more than 35 years of experience,
Dr. Weiss has helped empower millions of investors to make better financial
decisions through his monthly Safe Money Report and daily Money and Markets.

Dr. Weiss, along with Weiss analyst Mike Larson, specifically named nearly all
of the major institutions that have suffered a financial failure in this crisis.
Weiss predicted the demise of Bear Stearns 102 days prior to its failure, Lehman
Brothers (182 days prior), Fannie Mae (eight years prior), and Citigroup (110
days prior). Similarly, the U.S. Government Accountability Office (GAO) reported
that, in the 1990s, Weiss greatly outperformed Moody`s, Standard & Poor`s, A.M.
Best and D&P (now Fitch) in warning of future life insurance company failures.
(See the Weiss forecast track at
http://blogs.moneyandmarkets.com/martin-weiss/the-only-ones-who-warned-ahead-of-time/
and the GAO report at http://archive.gao.gov/t2pbat2/152669.pdf.)

Dr. Weiss is a New York Times best-selling author with a new book, "The Ultimate
Depression Survival Guide: Protect Your Savings, Boost Your Income and Grow
Wealthy Even in the Worst of Times" available in mid-April.

Dr. Weiss` white paper, "Dangerous Unintended Consequences" is available at
http://www.moneyandmarkets.com/files/documents/banking-white-paper.pdf, and the
video recording of his online video webinar for investors can be viewed,
starting tomorrow afternoon at http://images.moneyandmarkets.com/DSG-MED/.

For a full history of Weiss Research, Inc., including an important 2006
settlement with the Securities and Exchange Commission, please see
http://www.moneyandmarkets.com/content/history.html.

Photos/Multimedia Gallery Available:
http://www.businesswire.com/cgi-bin/mmg.cgi?eid=5934400&lang=en

For Weiss Research, Inc.
Elizabeth Kelley Grace, 561/702-7471
elizabethkelleygrace@gmail.com
or
Terri Slater, 561/487-7037
terrislater@comcast.net
or
Broadcast: Pam Reimer, 608/727-2600
preimer@merr.com

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