Mercantile is soon to suffer (as is all banks) from financial 'Chinese Water Torture.'
Many of you know of the slow painful torture the Chinese made famous .... water dripping - incessantly - on one's forehead until it caused the victim to go insane .... well that's what's going on in the banking business now.
First it was the 'Asset Erosion' (i.e. Loan (i.e. Asset) Write off's, Write downs's and Foreclosures, now it's 'Net Interest Erosion.'
Normally when rates come down banks 'net interest margins' expand due to the lag affect. The problem now is with banks investing their liquidity disproportionately in Treasury securities (1.48% - 5 Yr Treasury)and funding that with 1.46 - 2 Yr CD's the 'Spread' is little better than 'Breakeven.'
If your holding bank stocks, especially troubled ones that are 'hoarding cash' your in for yet another NEGATIVE surprise.