This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Sterling Targets Among New York Banks

NEW YORK (TheStreet) - Following an exclusive interview with John Millman, during which the Sterling Bancorp (STL) President said his firm was considering acquisitions, TheStreet has developed a list of potential bank targets in the New York Tri-state area.

Millman also said his bank was taking advantage of the "constant change and flux" in the small business lending market following the bankruptcy of CIT Group and because lenders including Merrill Lynch - acquired by Bank of America (BAC) in January 2009 - Wachovia, which was acquired by Wells Fargo (WFC) in December 2008, and Washington Mutual, which failed and was purchased from the Federal Deposit Insurance Corporation by JPMorgan Chase (JPM) in September 2008, have essentially exited the market.

Sterling Bancorp's numbers reflect the bank's success in growing its business lending, as its loan portfolio grew 15% over the year ended June 30.

Click the image below for the list of ten commercial banks in the New York Tri-state with the highest asset concentrations in commercial and industrial loans:

Commercial and industrial loans (C&I) are loans to businesses that are not secured by real estate.

Two banks on the list - Bank Leumi USA and Bank of Tokyo-Mitsubishi UFJ Trust Co. would not be candidates for an acquisition by Sterling Bancorp, since they are subsidiaries of large foreign holding companies.

Small banks dominate the list, as half had total assets below $200 million as of June 30. All ten banks on the list had total risk-based capital ratios as of June 30 well above the 10% required for most banks to be considered well capitalized by regulators. The one exception was Heritage Community Bank of Randolph, NJ, which also had the highest nonperforming assets ratio among the group. The numbers would indicate that Heritage Community needs additional capital, and may be an acquisition candidate.

After Bank Leumi, Bank of Tokyo-Mitsubishi UFJ Trust Co. and Sterling itself, the largest bank on the list is 1st Constitution Bank of Cranbury, N.J. which is held by 1st Constitution Bancorp (FCCY).

1st Constitution could be an attractive acquisition candidate for a bank seeking to grow its C&I portfolio and the bank's Middlesex county location would also make sense for a New York based acquirer. 1st Constitution has remained profitable through the financial crisis, although the bank has a long way to go to get back to its excellent track record of increasing annual returns for the four years ending in 2007, when the return on average assets was 1.53%.

State Bank of Long Island is a relatively large player with $1.6 billion in total assets that didn't make the list, since the bank's ratio of C&I loans to total assets was 20% as of June 30, but that is still a significant concentration in business lending. The bank is the main subsidiary of State Bancorp (STBC), and after a net loss of $13.1 million (at the bank level) in 2009 mainly because its provision for loan loss reserves increased to $23 million from $3 million the previous year, State Bank of Long Island has been profitable for the first two quarters of 2010.

-- Written by Philip van Doorn in Jupiter, Fla.



>To contact the writer of this article, click here: Philip van Doorn.

>To follow the writer on Twitter, go to http://twitter.com/PhilipvanDoorn.

>To submit a news tip, send an email to: tips@thestreet.com.

Philip W. van Doorn is a member of TheStreet's banking and finance team, commenting on industry and regulatory trends. He previously served as the senior analyst for TheStreet.com Ratings, responsible for assigning financial strength ratings to banks and savings and loan institutions. Mr. van Doorn previously served as a loan operations officer at Riverside National Bank in Fort Pierce, Fla., and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a bachelor of science in business administration from Long Island University.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,915.07 -70.54 -0.42%
S&P 500 1,964.68 -8.15 -0.41%
NASDAQ 4,396.2040 -22.83 -0.52%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs