Even if you can barely stand to watch the market these days, you've probably noticed that Bank of America (BAC, news) has been getting pounded like it's 2008 again. Rival giants Citigroup (C, news) and JPMorgan Chase (JPM, news) are falling as well, along with a lot of other financial-sector stocks.

Among the reasons for this rout: fear that European bank woes will spread to U.S. banks, lawsuits from investors holding mortgage-backed securities that blew up, and the threat of a new global recession.

It's been three years since taxpayers bailed out the banks after the credit meltdown, and it seems the Big Three U.S. banks aren't out of the woods yet. They never regained the stock value they lost in the financial meltdown. And they're melting down again.

The question facing investors now is this: Have the latest losses given us another chance to buy the stocks of these financial giants at bargain prices -- or are these banks so troubled they can't be fixed?

I'm in the 'bargain' camp. Here's why.

Where the big banks stand

Let's start with the key takeaway: As hard as the market has been on financial companies, taking them down much further than stocks as a whole, this isn't 2008. Banks, for the most part, are far stronger than they were going into the credit meltdown in 2007. And in fact, if you go through investor fears one by one, you can make the case that most of them are overblown.

I'm focusing this column on B of A because it's the biggest U.S. bank and the loss leader, down 57% since January highs of $15.31. It's lost 35% in just the past month. But Citigroup is down 48% from its highs this year, and JPMorgan Chase is off 30%. So they should be asked the same questions.

Image: Michael Brush

Michael Brush

The two latter banks do have some advantages. Counting the bailout and other efforts, both got more government support than Bank of America during the credit meltdown. JPMorgan Chase in particular limited its exposure to the mortgage problem at the heart of that crisis.

Bank of America, on the other hand, took on added exposure during the crisis when it purchased Countrywide Financial and Merrill Lynch. Countrywide was a large mortgage originator, and Merrill Lynch was one of the biggest vendors of mortgage-backed securities. So B of A remains very exposed to risky home mortgages and a weak real-estate market.

But B of A's stock has also been beaten up the most of late, suggesting that it might offer the most potential for investors. Investing sometimes works that way.

I'm not the only one who thinks that these stocks look interesting. I talked with several financial sector money managers recently, and many believe the current selling has gone too far. "We think they are attractively valued today," says Ryan Lentell, senior research officer at Manulife Asset Management. "We think they are cheap for long-term investors." Manulife Asset Management manages the John Hancock Financial Industries Fund (FIDAX).

Veteran banking sector expert William Isaac is also bullish on bank stocks overall. "If you believe that our political leaders are going to get their act together and fix the fiscal crisis, and your time horizon is three or four years, I would think that banks are about as good a buy as you can get right now," he says. Isaac was director of the Federal Deposit Insurance Corp. in the early 1980s, another tumultuous time for the banking sector. He's now senior managing director of FTI Consulting, a financial services sector consulting firm.

Here's a look at the problems these banks face -- and why the worries may be overblown.

Catching the Euro-flu

One of the major fears about the large U.S. banks is that they'll get dragged into the mess in Europe. Among the big risks: They might be exposed via lending to and contracts with troubled European banks or by holding shaky European government debt. Another major risk is that capital markets might freeze up again if big European banks go under.

Several top-rated money managers I talked to discount these risks.

First, the so-called counterparty risk resulting from business with European banks seems small. "We don't know for sure, but it does not look like it is significant," says Michael Yoshikami, the CEO and founder of YCMNET Advisors, ranked among the top 100 independent financial advisers by Baron's.

Second, says Lentell, at Manulife Asset Management, the exposure of the Big Three U.S. banks to European debt "is small compared to size of their balance sheets."

Meanwhile, U.S. banks have strengthened their balance sheets and lowered their exposure to short-term funding problems since the crisis, suggesting they can weather a temporary freeze in the capital markets.

Fending off the lawyers

Bank of America is being sued regularly by investors, racking up big losses on mortgage-related investments built on home loans originated by Countrywide Financial and repackaged by Merrill Lynch. "Obviously, there aren't many days that I get up and think positively about the Countrywide transaction in 2008," Bank of America CEO Brian Moynihan said in a recent conference call with investors.

On top of this, attorneys general across the country are suing Bank of America for questionable foreclosure practices.

These kinds of suits grab headlines and scare investors. They may continue to cost Bank of America billions, and they're a big reason the bank's stock has stayed down.