CORRECTED - CORRECTED-UPDATE 2-Analyst Whitney sees "little hope" from bailo
(Corrects to show that Wachovia shares were down 3 cents, not more than 10 percent, in penultimate paragraph)
(Adds analyst comments, background; updates share price)
By Tenzin Pema
BANGALORE, Sept 23 (Reuters) - The credit crisis that began last summer has intensified so much that any U.S. government bailout plan has "little hope" of improving core fundamentals over the near and medium term, said analyst Meredith Whitney.
The Oppenheimer & Co analyst cut her outlook for U.S. banks and forecast further dividend cuts and capital raises at banks. She projected a quarterly loss for Citigroup Inc (C.N: Cotización).
"Since the onset of the credit crisis, over $2 trillion less liquidity has flown through the U.S. domestic capital markets than during...a year prior," Whitney said.
"With that much less available capital, both consumers and corporations have and will spend less," she added.
As the consumer comes under more pressure in the difficult economy, credit card debt may grow, Whitney wrote in a note to clients.
Whitney, however, noted that tighter credit standards and credit line reductions have already strained more consumers into defaulting across the spectrum of lending products. Continuación...