Under-the-Radar Financial Stocks for Today

"Under-the-Radar Stocks" is a daily feature that uncovers little-known companies worthy of investors' consideration. Check in at 5 every morning to find out about stocks that tend to beat their bigger brethren.

Financial firms remain in investors' crosshairs as nine large companies are seeking to receive approval to repay funds from the Troubled Asset Relief Program.

But as the wounded, including Morgan Stanley(MS Quote) and BB&T(BBT Quote), benefit from renewed optimism, lesser-known companies are getting no press. Here are two micro-cap regional banks worthy of consideration. Neither needed TARP money. And both have posted earnings growth for nine consecutive quarters.

Tyler, Texas-based Southside Bancshares(SBSI Quote) is a community-focused financial institution that provides consumer and commercial loans, trust services, safe deposits and brokerage. TheStreet.com Ratings upgraded Southside Bancshares to "buy" on May 28 after strong first-quarter results. The stock earns an A-minus grade, placing it near the top of Ratings' 5,000-plus stock coverage universe.

First-quarter revenue rose 37% to $56 million, and earnings per share more than doubled. What's more, Southside Bancshares boasts an impressive $85 million cash balance. But its debt is sizable, with over $817 million of long-term obligations.

Nevertheless, Southside Bancshares is an attractive stock. It trades at an earnings multiple of 9.59, making it 40% cheaper than its average peer in the regional banking industry. The shares also offer a dividend yield of 2.22%, slightly below the S&P 500 Index average. Southside Bancshares has climbed 13% this year, outperforming the Dow Jones Industrial Average and S&P 500.

Arrow Financial(AROW Quote), based in Glens Falls, New York, owns and operates 31 banks in northeastern New York, providing a full range of commercial and consumer banking and financial products. Like Southside Bancshares, Arrow is rated "buy" and gets a grade of A-minus.