Yesterday's Regional Bank Earnings Roundup

For those investors who follow the financial sectors, this week provides a smorgasbord of information. JPMorgan Chase kicked things off last week, and mega-banks Citigroup and Wells Fargo reported Tuesday. Bank of America joined in with its release Wednesday.

Not to be forgotten, smaller regional banks also report their quarterly results this week. As the name suggests, regional banks tend to limit operations to smaller regions of the country, and thus are not as exposed as some of their larger cousins to the troubles in Europe or investment banking.


Average Estimated EPS

Actual EPS


Associated Banc-Corp (Nasdaq: ASBC  ) $0.23 $0.23 0%
City National (NYSE: CYN  )             $0.82 $0.82 0%
East West Bancorp (Nasdaq: EWBC  ) $0.41 $0.43 4.9%
Independent Bank (Nasdaq: INDB  ) $0.54 $0.52 (3.7%)
Westamerica Bancorp (Nasdaq: WABC  ) $0.79 $0.77 (2.5%)
Western Alliance Bancorporation $0.09 $0.07 (22.2%)

Source: Yahoo! Finance & Company Press Releases

Some earnings highlights
Wisconsin-based Associated met expectations, and recovered from a $0.18-per-share loss in 2010, posting $0.66 per share for 2011. This was helped by a decrease in non-performing loans of 38% from last year, down to a total of $357 million.

City National met expectations as well, but also announced it will be raising its quarterly dividend to $0.25, pushing its yield to around 2%. The year 2011 also marked the 19th consecutive profitable year for the California bank.

East West Bancorp joined City National in raising its dividend, increasing its annual dividend to $0.40 a share on the strength of record profits for 2011. Nonperforming assets have represented less than 1% of total assets for nine consecutive quarters, further reflecting the company's strong balance sheet.

Independent's slight earnings miss can be attributed to a one-time charge during the fourth quarter amounting to $0.02 a share. Net income was up 12.9% over 2010, driven primarily by an increase in non-interest income, which itself was up 12.4%.

Westamerica also missed expectations, but unlike Independent, its net income was down for the year. As a result, the stock has been down as much as 5% off Wednesday's close. Positive signs from the bank include a decline in non-performing assets over the past year and a recently increased dividend.

After experiencing a loss in 2010, Western Alliance recovered this year, thanks in part to a growth in both its loan portfolio and deposits. Chairman and CEO Robert Sarver noted, "Fourth-quarter results will position the company for growth in 2012 by riding the momentum of higher loan growth, along with a stable net-interest margin, expense management, and continued improvement in asset quality."

Opportunities in regional banks
I personally like the potential of regional banks, but they may not be for everyone. Earnings are just one thing to consider when choosing an investment, so view these results as a small piece of a much larger puzzle.  In fact, a regional bank similar to the ones here is featured prominently in our brand-new free report "The Stocks Only the Smartest Investors are Buying." To find out which one it is, get your copy today before it's too late.

Fool contributor Robert Eberhard holds no position in any company mentioned. Follow him on Twitter @GuruEbby. The Motley Fool owns shares of Citigroup, Wells Fargo, Bank of America, and JPMorgan Chase. The Fool owns shares of and has created a covered strangle position on Wells Fargo. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Read/Post Comments (0) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1762461, ~/Articles/ArticleHandler.aspx, 3/27/2015 11:48:21 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Apple's next smart device (warning, it may shock you

Apple recently recruited a secret-development "dream team" to guarantee its newest smart device was kept hidden from the public for as long as possible. But the secret is out. In fact, ABI Research predicts 485 million of this type of device will be sold per year. But one small company makes Apple's gadget possible. And its stock price has nearly unlimited room to run for early-in-the-know investors. To be one of them, and see Apple's newest smart gizmo, just click here!