For investors, "bank" has become a four-letter word, rife with weekly blowups from hefty home equity losses, residential construction loans gone bad, and market fears that the worst is yet to come.
Last week's volatility hit fever-pitch proportions as the music suddenly stopped for IndyMac shareholders. The Fed (as in FDIC) seized the bank after an old-fashioned run by desperate accountholders, which was triggered by IndyMac's unwise focus on Alt-A mortgages during the height of the real estate bubble.
The financial system is showing undeniable signs of cracking, but as with most bubbles, the subsequent (and inevitable) burst shows which firms had been swimming naked when the tide went out. On the flip side, those with the foresight to maintain their wits and keep their shorts on can usually capitalize on the situation by either growing or consolidating market share. Here are three regional banks successfully navigating the current industry turmoil.
Prudent PNC Financial Services
Last week, Pittsburgh-based PNC Financial
Simply citing Warren Buffett as a past shareholder in Buffalo-based M&T Bank
Bank on BB&T
Fools, take note: Regional-bank investing requires a strong stomach. Even the savviest operator is subject to the whims of local trends, since these banks have smaller deposit bases and less geographic diversity than banking behemoths such as Bank of America