NEW YORK (
) -- Figuring out which regional banks were in line to buy failed competitors from the
Federal Deposit Insurance Corp.
was a good way for investors to make money at the end of last year, but the strategy may be largely played out.
Certainly it looked that way on Monday
, as shares of
(UMPQ - Get Report)
, a Portland, Ore-based bank, dropped 3.9% on the first trading day after it bought Seattle's
, picking up nearly $473 million in assets and $439 million in deposits.
Analysts at Sterne Agee argued in a report Monday the deal was already priced in. Umpqua's stock had run up some 35% over the past three months, more than twice the return of the
KBW Regional Banking ETF
over the same period.
Other recent FDIC-assisted acquirers that have seen little or no rally in their shares following announced deals include
, which is down about nine percent since buying Horizon Bank from the FDIC on Jan. 8 and
Hancock Holding Co.
(HBHC - Get Report)
, up just two percent since buying
Peoples First Community Bank
on Dec. 18.
Columbia Banking System
(COLB - Get Report)
, which bought
Columbia River Bank
from the FDIC on Friday, saw its shares open more than seven percent higher on Monday, though it finished the day just 1.2% higher.
"Most of the banks that have good capital levels and been identified as potential acquirers in FDIC-assisted deals have seen their stock prices really rally over the past -- you know, call it six months -- and so now if a deal gets done its really just turning an expectation into a certainty," says Aaron James Deer, analyst at Sandler O'Neill.