Shares of Metropolitan Bank (MCB 1.86%) climbed as much as 12% early Friday, then settled to trade up around 5.6% as of 3:45 p.m. EDT after the bank announced better-than-expected third-quarter 2023 earnings.
Stability despite broader banking-industry challenges
Metropolitan Bank's third-quarter revenue fell 13.1% year over year to $60.1 million, just missing analysts' consensus estimates of $61 million. But its generally accepted accounting principles (GAAP) net income of $1.97 per share (down 11.7% year over year) arrived well above estimates for $1.76 per share.
Drilling deeper into its quarter, total deposits climbed $233 million sequentially from last quarter to $5.5 billion, net loan growth arrived at $204.9 million from Q2, and net interest income remained stable at $53.6 million.
CEO Mark DeFazio said he was "pleased" with the quarter, "particularly given the continuing challenges facing the banking industry." He added that Metropolitan's performance remained strong thanks to its "disciplined approach to balance sheet management and net interest income stability."
Here's what Metropolitan Bank investors should do now
Metropolitan Bank didn't provide specific forward financial guidance. But it did note, with acceptable risk-based capital ratios and $3 billion in available secured wholesale funding capacity, it remains "well capitalized" as measured by regulatory banking guidelines.
That said, shares are still down more than 40% year to date, even after today's bounce on a better-than-feared report. I would personally prefer seeing more tangible signs of a return to sustained, profitable growth before Metropolitan Bank could prove itself worthy of a spot in my portfolio. In the meantime, I'd rather put my money to work in any number of promising stocks available, with underlying businesses operating from a position of strength.
