UPDATE 2-RESEARCH ALERT-SunTrust a likely takeover target: Bove

(Adds Bove comments, updates share movement)

BANGALORE, June 23 (Reuters) - SunTrust Banks Inc (STI.N) could be a potential acquisition target said Ladenburg Thalmann analyst Richard Bove, who slashed the regional bank's price target, and called it another bank "that is now worth more dead than alive".

Potential suitors for SunTrust could be Wells Fargo & Co (WFC.N) or JPMorgan Chase & Co (JPM.N), Bove said in an email sent to Reuters.

He chopped the price target on the stock to $42 from $63, and for the second time this year revised downward 2008 earnings estimates, now to $3.19 a share from $3.97.

The revisions reflect the company's view that loan losses may grow by 10 percent to 15 percent in the second quarter, Bove said.

SunTrust shares were down 2 percent to $36.48 in afternoon trade on the New York Stock Exchange. Early in the session they rose 4 percent.

Bove said the key areas of concern for SunTrust continue to be Alt-A mortgages and loans of all types in Florida. The bank has $48.2 billion in residential real estate and home equity loans, which represent 39 percent of its loan portfolio, he wrote in a June 21 research note to clients.

"Alt-A" loans are usually given to those with clean credit histories but who have limited income documentation.

The bank's non-performing assets are 1.87 percent of loans and its 90-day past due loans have increased by 21.8 percent in the last quarter, Bove noted. He said the bank believes that the rate of gain on these troubled assets has slowed.