As the process of finding a buyer for independent broker-dealer Morgan Keegan drags on, analysts are wondering whether it might make more sense for parent Regions Financial to put itself on the block.
While Morgan Keegan is on the hook for up to $1.5 billion in client claims related to bad mortgage investments, Regions owes far more.
As a TARP bank, Regions owes the government $3.5 billion at an increasingly steep interest rate.
Even if it had found a quick buyer for Morgan Keegan, the price would be unlikely to cover that debt.
And with possible buyers evaporating after the MF Global failure put regulatory risk back on the table and drove would-be financing sources away, no near-term deal is visible.
Stifel Financial is the front runner, but that scenario -- getting acquired by another brokerage firm -- is unlikely to make Morgan's 1,300 advisors happy.
But should Regions sell itself, it might get a reasonable deal for all constituencies.
Consider the sale of Wilmington Trust to M&T Bank last year. That deal essentially gave M&T a legendary wealth management unit and threw in the bank for free.
As deep in debt as Regions is, they might explore something similar. Here too, the question is who would buy.