Richard Bove of Rochdale Securities said on CNBC's Fast Money that Goldman Sachs (NYSE: GS) will increase its dividend meaningfully because they are trying to re-establish their position in the market.
He has also shared with the viewers his analysis of the impact of the reforms on the state of the banking sector. Bove concluded that administration's reforms will make banks less profitable.
Richard Bove thinks that about 30% of consumers will find out that banks don't want to do business with them because they won't be able to profit on these consumers.
The winners in this situation will be consumer finance and payday loan companies like Advance America (NYSE: AEA) and Western Union (NYSE: WU), as many consumers will have nowhere else to go. Advance America (AEA) gained 0.85% on Friday, while Western Union (WU) dropped 2.33%.
His biggest concern are the regional banks, as they will be hit hard with the reforms. Richard Bove believes they will become totally unattractive stocks. If he is right SPDR KBW Regional Banking (ETF) (NYSE: KRE) is the ETF that should be avoided in the future. KRE jumped 0.19% on Friday, despite Bove's comments.
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