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The 2014 All-America Research Team: Banks/Large-Cap, No. 3: Betsy Graseck

< The 2014 All-America Research TeamBetsy GraseckMorgan StanleyFirst-Place Appearances: 0

Total Appearances: 6

Analyst Debut: 2009

For a second consecutive year, Morgan Stanley’s Betsy Graseck claims third place. “Betsy seems to be able to see the macro changes throughout her landscape,” observes one client. “She makes value-added calls on stocks and tends to be directionally correct most of the time.” Large-cap U.S. banks’ shares climbed 8.8 percent year to date through mid-September, eclipsing the nation’s broad market by 1.5 percentage points, and Graseck recommends that investors overweight the group, forecasting that “grindingly higher” gross domestic product growth will fuel solid loan expansion. She is keeping an eye on credit quality; interest rate levels and spreads; consumer confidence and spending; and litigation expenses, which the analyst expects to decline over the next few years. In anticipation of higher interest rates, Graseck is touting Bank of America Corp. of Charlotte, North Carolina, and Birmingham, Alabama’s Regions Financial Corp. She also favors New York–based Citigroup and JPMorgan Chase & Co., thanks to their ability to manage expenses successfully. Finally, she is upbeat on Discover Financial Services of Riverwoods, Illinois, believing that it will benefit as consumers releverage.

Jason Goldberg

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