M&T Bank's subprime drama offers a cautionary tale for the industry. The Buffalo-based bank's stock has been hit by its changed guidance, which lowered expectations. The reason was the bank's "alt-A" mortgages, which are loans not quite of the subprime variety but are still considered a bit of risk. The bank was not known as a power or big-volume shop in this market, so the news came as a shock. Apparently, the bank is having some trouble selling the loans in the secondary market. The issue is whether there are other smaller, regional bank in for the same turbulence due to the unfolding untraditional mortgage market meltdown. You would have to think that more banks trended away from the 30-year fixed once they saw the market develop. So we may be in for similar news from others. See below for more subprime news.

For more:
- here's a New York Post article