Another quarter has ended, and with that come earnings releases. For those investors who follow the financial sector, earnings may have started when JPMorgan Chase and Wells Fargo posted their results last Friday. However, a handful of smaller banks followed their much larger cousins with results released Tuesday morning.
Not to be forgotten, regional banks and savings and loans tend to limit operations to smaller regions of the country, but they're generally less exposed to the risky and exotic activities of some of their larger brethren. Their results can often be an indicator of what has been happening in smaller segments of the economy.
Average Estimated EPS
|Associated Banc-Corp (Nasdaq: ASBC )||$0.23||$0.24||4.3%|
|Glacier Bancorp (Nasdaq: GBCI )||$0.21||$0.23||9.5%|
|MB Financial (Nasdaq: MBFI )||$0.31||$0.33||6.5%|
|National Penn Bancshares (Nasdaq: NPBC )||$0.14||$0.16||14.3%|
|Sandy Spring Bancorp (Nasdaq: SASR )||$0.33||$0.35||6.1%|
Source: Yahoo! Finance; Company Press Releases.
Associated Banc-Corp used the release of its quarterly earnings to announce an increase of its quarterly dividend from $0.01 per share to $0.05 per share. Net income reached its highest level since early 2008, and nonperforming assets have declined 33% from last year.
Glacier Bancorp saw a 59% increase in net income over the same period last year. President and CEO Mick Blodnick pointed to reduced credit costs as the reason behind the better earnings, and he hopes the trend will continue for the rest of the year.
MB Financial completed the reacquisition of nearly $200 million in preferred stock issued as part of TARP in 2008, removing the bank from the program. Avoiding the dividends required of these preferred shares should help increase net income going forward.
After net income increased 45% from the same quarter last year, National Penn announced a 40% increase to its quarterly dividend, as well as the authorization of a share repurchase program. The new higher dividend pushes the stock's yield over 3% at today's price.
The first quarter of 2012 represented the third consecutive quarter of loan growth for Sandy Springs, which was reflected in 16.4% growth in net income from the previous quarter. Nonperforming loans have also declined 18.3% over the past year, further strengthening the bank's balance sheet.
Opportunities in regional banks
I like the potential of regional banks personally, 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 to a much larger puzzle. In fact, a 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.