Bank stocks took another beating Friday as investors digested more negative economic news.

The KBW Bank Index fell 5.3%, ending the week down 14%.

"There's just no good news out today, and so there's continued uncertainty in the markets," said Matthew Shields, a trader at FIG Partners LLC.

A Philadelphia Federal Reserve Bank survey released Friday forecast that the U.S. economy will shrink 5.2% this quarter, at an annual rate.

Also on Friday, the Reuters/University of Michigan Survey of Consumers said its index reading of confidence for February fell to 56.2 from 61.2 in January.

Scott A. Anderson, a senior economist at Wells Fargo & Co., wrote in a note Friday that the consumer confidence report suggests that "a true bottom in consumer spending is still a ways ahead of us and, indeed, the road ahead could get uglier."

The broader markets fluctuated throughout the session but closed in negative territory after the House passed the $787 billion economic stimulus bill in the afternoon. The Dow Jones industrial average closed down 1.04%, and the Standard & Poor's 500 % index was off 1%.

Wells Fargo & Co. fell 6.2%. Late Thursday, it revised its fourth-quarter loss upward, to $2.73 billion, or 84 cents a share. The San Francisco banking company cited a noncash impairment charge of $328.4 million for investments in certain perpetual preferred securities.

On Jan. 28, Wells had reported a fourth-quarter loss of $2.55 billion, or 79 cents a share.

Both JPMorgan Chase & Co. and Citigroup Inc. said Friday that they would temporarily halt mortgage foreclosures in order to give the Obama administration time to complete its loan modification program. JPMorgan Chase fell 5.7%, and Citi 3.3%.

Meanwhile, The Wall Street Journal reported in its online edition Friday that Citi is weighing whether to sell its Mexican banking unit, Grupo Financiero Banamex, if its financial position continues to deteriorate. The newspaper cited people familiar with the situation. Investment bankers estimated that Banamex, which accounted for roughly half of Citigroup's 2007 profit of about $3.6 billion, could fetch at least $9 billion in a sale.

Last month Citi agreed to spin off its Smith Barney brokerage unit into a joint venture with Morgan Stanley, generating $2.7 billion of cash for Citi.

Kevin J. St. Pierre, an analyst at Sanford C. Bernstein & Co. LLC, wrote in a research note Friday that Fifth Third Bancorp is "un-investable" because the Cincinnati company would probably fail the Treasury Department's new stress test for banks and be forced to raise capital. Other companies that could be in the same boat are Regions Financial Corp., SunTrust Banks Inc., and to a lesser extent KeyCorp, Mr. St. Pierre wrote.

Fifth Third and Regions declined to comment. Fifth Third fell 20 cents, to $2, and Regions fell 19 cents, to $3.38.

Key declined to comment, and SunTrust did not return phone calls; SunTrust fell 5.7%, and KeyCorp 5%.

Bank of America Corp. fell 5.1%. The Charlotte Observer reported that North Carolina Attorney General Roy Cooper is asking B of A to supply details of bonuses paid this month and to justify the payments in light of its $45 billion of Troubled Asset Relief Program capital infusions.

B of A did not return phone calls.

PNC Financial Services Group Inc. fell 9.2%. Stifel Nicolaus & Co. analyst Collyn Bement Gilbert on Friday cut her 2009 earnings estimate on the Pittsburgh company from $4.28 a share, to $2.45 a share, due to expectations of bigger loan-loss provisions.

The decliners Friday included U.S. Bancorp, off 9.2%; BB&T Corp., 7.4%; and M&T Bank Corp, 4.3%.

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