This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
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
$1 buys you full access to ALL of TheStreet's Subscription Services! Learn More

Assessing 29 Community Banks That Report Quarterly Results

Stocks in this article: EWBCCFNLHAFCHOMBMCBI

The first guideline states that if loans for construction, land development, and other land are 100% or more of total risk-based capital, the institution is considered to have loans concentrations above prudent risk levels, and should have heightened risk management practices.

The second guideline covers overexposure to construction and development loans including loans secured by multifamily and commercial properties. If loans for construction, land development, and other land, and loans secured by multifamily and commercial property are 300% or more of total risk-based capital, the institution would be considered to have CRE concentrations above prudent levels, and should employ heightened risk management practices.

Pipeline is the ratio of money lent on real estate loans vs. total loan commitments. A pipeline around 60% funded is considered healthy, while a pipeline ratio of 80% and higher is considered a potential problem. At 100% the bank has fully funded all real estate loan commitments.

OV/UN Valued: Community banks with a Red reading is undervalued, while those with a Black reading is overvalued according to ValuEngine.

VE Rating: A 3-Engine rating is a Hold, a 4-Engine rating is a Buy and a 5-Engine rating is a Strong Buy.

Last 12-Month Return (%): Banks with a red number declined by that percentage. Those with a black number increased by that percentage. The performance has been mostly positive.

Forecast 1-Year Return: All numbers are black, so all 29 community banks in the table are projected to move higher over the next 12 months.

P/E Ratios: Community banks have some price-to-earnings ratios that are elevated, but most are favorable.

I highlighted in red the banks with overexposure in C&D or CRE loans or elevated pipelines.

The banks overexposed to C&D Loans are Cardinal Financial (CFNL), Home BancShares (HOMB) and Union First Market Bankshares (UBSH).

Overexposed to CRE Loans are Boston Private Financial Holdings (BPFH), Cardinal Financial, East West Bancorp (EWBC), Fulton Financial (FULT), Hanmi Financial (HAFC), Home BancShares, Independent Bank (INDB), MetroCorp Bancshares (MCBI), Sandy Spring Bancorp (SASR), Union First Market Bankshares, Umpqua (UMPQ), Virginia Commerce Bancorp (VCBI) and Western Alliance Bancorporation (WAL).

Banks with a stuffed loan pipeline are East West, Hanmi, Home Bancshares, Virginia Commerce and Western Alliance.

2 of 3

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!

Markets

DOW 17,827.75 +12.81 0.07%
S&P 500 2,072.83 +5.80 0.28%
NASDAQ 4,787.3170 +29.0650 0.61%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

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