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10 Buy Rated Regional Bank Stocks (Update 3)

10. First Financial Bancorp

Shares of First Financial Bancorp (FFBC) of Cincinnati closed Monday at $17.71, rising 6% year-to-date, with a five-year total return of 38%.

The stock is rated an "A-minus" by TheStreet Ratings.

The company currently has a policy of paying out 100% of its earnings, through a fixed quarterly dividend of 12 cents a share, and a variable dividend, which is currently 19 cents a share. Based on that combined 27-cent quarterly payout, the shares have a dividend yield of 6.10%, which is, by far, the highest among the 10 regional bank holding companies featured here.

During the fourth quarter the company purchased 22 Indiana branches from Flagstar Bank, FSB, including $465 million in deposits. This followed the third-quarter purchase of 16 Ohio branches from Liberty Savings FSB, with $342 million in deposits.

The company had total assets of $6.7 billion as of Dec. 31, with 138 branches.

First Financial on Wednesday reported fourth-quarter earnings of $17.9 million, or 31 cents a share, increasing from $15.6 million, or 27 cents a share, in the third quarter, and $14.3 million, or 24 cents a share, in the fourth quarter of 2010.

The fourth-quarter net interest margin declined to 4.32% from 4.55% the previous quarter and 4.65% a year earlier, as First Financial Bancorp's interest spread was "negatively impacted by an increase in interest-earning assets from acquisitions and the continued amortization and paydowns in the covered loan portfolio" of loans acquired through the purchase of three failed institutions from the Federal Deposit Insurance Corp. in 2009.

Excluding acquired loans covered by FDIC loss-sharing agreements, First Financial Bancorp's average loans increased 7% during the fourth quarter and 6% year-over-year, to $2.98 billion as of Dec. 31.

The fourth-quarter ROA was 1.09%, and the ROA has ranged between 0.90% and 1.11% over the past five quarters, according to the company.

The shares trade for 1.6 times tangible book value, according to SNL Financial, and for 15 times the consensus 2012 EPS estimate of $1.22, among analysts polled by FactSet.

Interested in more on First Financial Bancorp? See TheStreet Ratings' report card for this stock.
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