Thursday's Financial Winners & Losers

Franklin Bank trades lower on news of a convertible bond offering.
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Updated from 2:49 p.m. EDT

The financial sector was slightly lower in choppy trading Thursday, with

Franklin Bank

(FBTX)

coming in as one of the biggest-percentage losers among financial stocks.

The Houston-based savings bank was down 5.5% to $15.70 after offering $100 million in contingent convertible senior bonds under its existing shelf registration. Proceeds will pay for a portion of Franklin's $134 million buyout of Texas-based First National Bank of Bryan, a deal announced in December.

Mortgage insurer

MGIC Investment

(MTG) - Get Report

traded heavily after first-quarter earnings plummeted from last year and widely missed Wall Street estimates. The Milwaukee-based insurer traded actively, closing down 14 cents at $56.99.

Also turning in lower-than-expected first-quarter profits were

Independent Bank

(INDB) - Get Report

of Rockland, Mass., and Oregon's

Cascade Bancorp

(CACB)

. Independent was off 2.9% to $31.49; Cascade slipped 4% to $23.58.

On the winning side, both

Chicago Board of Trade

(BOT)

and

Chicago Mercantile Exchange

(CME) - Get Report

were higher after BMO Capital Markets expressed belief that CME remains CBOT's preferred buyer vs.

IntercontinentalExchange's

(ICE) - Get Report

rival bid.

BMO started coverage on CBOT with an underperform rating, citing valuation, but shares still added $1.77 earlier in the day and closed up 43 cents at $189.36. CME closed slightly higher and ICE closed slightly lower, both on outperform ratings.

Among other stocks lifted by positive analyst calls, Arkansas-based

Bank of the Ozarks

(OZRK)

gained 4.4% to $29.15 on a Cohen Bros. upgrade to buy from hold, and

E*Trade

(ETFC) - Get Report

rose 2.1% to $21.95 after Deutsche Bank gave the online broker a new buy rating.

Subprime mortgage lender

NovaStar Financial

(NFI)

dipped a bit from Wednesday night's after-hours leap, but it was still up 1.8% to $5.12 on yesterday's post-bell announcement that it will

consider selling itself

.

After a rough morning, KBW Bank Index was up slightly at 114.57, and

NYSE Financial Sector Index

recovered 0.3% to 9520.05.