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5 Cheap Small Bank Stocks (Update 2)

1. Wilshire Bancorp

Shares of Wilshire Bancorp (WIBC - Get Report) of Los Angeles closed at $4.82 Thursday, returning 33% year-to-date, following a 52% decline during 2011.

The shares trade for eight times he consensus 2013 EPS estimate of 59 cents and for 1.5 times tangible book value. The consensus 2012 EPS estimate is 55 cents.

Wilshire Bancorp owes $62.2 million in TARP money. The U.S. Treasury on Monday commenced a public auction of the company's preferred shares held by the government, along with those of six other banks that still owe TARP money. The auction end after Wednesday's market close.

The company reported fourth-quarter net income applicable to common stockholders of $5.8 million, or eight cents a share, improving from a loss of $40.3 million, or $1.37 a share, during the fourth quarter of 2010, when Wilshire set aside $57.3 million for loan loss reserves, "largely driven by the disposal of a significant number of problem assets through note sales and charge-offs." The fourth-quarter 2011 provision for loan losses was only $1.5 million.

FIG Partners analyst Timothy Coffey on Jan. 25 maintained his "Outperform" rating for Wilshire, with a $4.50 price target, saying the "credit recovery story at the company is well under way," and that in light of an "excessive reserve position," the company could see an earnings boost by potentially booking no provisions for loan loss reserves during 2012.

The analyst estimates that Wilshire will earn 67 cents a share this year, followed by 2013 EPS of 84 cents.

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

>>To see these stocks in action, visit the 5 Cheap Small Bank Stocks portfolio on Stockpickr.

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

To contact the writer, click here: Philip van Doorn.

To follow the writer on Twitter, go to
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 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.
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